CUNA Deputy General Counsel Mary Dunn has noted that portions of the Federal Reserve's proposal could limit access to credit cards for some non-working members of households. The Fed proposal would prevent card issuers from requesting a consumer's household income on credit applications. The amended rule will instead require issuers to request a consumer's individual income or salary, the Fed said.
Specifically, the rule states that if a card issuer prompts an applicant to provide his or her "household income" on a credit card application,the card issuer cannot rely solely on the information provided by an applicant to satisfy the proposed regulatory requirements. Instead, the card issuer would need to obtain additional information about an applicant's independent income by contacting the applicant or through similar means.
Dunn said that this is one of many issues that CUNA would like to discuss with members of the Consumer Financial Protection Bureau once that entity becomes fully operational later this year.
The Fed release would also prohibit issuers from revoking initial offers of interest-free credit during a specified amount of time "unless the account becomes more than 60 days delinquent." The Fed currently imposes similar rules on so-called "teaser" credit card rates. It has also moved to include application and other first-time fees under a rule that limits the total amount of fees charged on a credit account to 25% of the account's credit limit.
The proposed clarifications to Regulation Z, Truth in Lending, were released last Friday and total 323 pages in length.