By Paula Ebben, WBZ-TVBy Paula Ebben

BOSTON (CBS) – A successful professional, Jenn Mandelenakis of Northbridge feels lucky to be able to give up that corporate life for a life at home with her young son and daughter. “My husband and I have worked very hard to build a situation that’s secure, that is financially stable,” she said.

But all that planning won’t do her any good the next time she applies for a credit card in her own name. Chances are, she’ll be denied. “It’s really frustrating,” she said.

This is all the result of the financial meltdown when congress passed the Credit Card Accountability, Responsibility and Disclosure Act. “The intent was really good,” explained financial advisor Dana Levit.

WBZ-TV’s Paula Ebben reports

The law cracked down on all kinds of nasty bank fees. But one regulation that just went into effect in October requires lenders to consider a person’s ability to repay what they borrow. According to Levit, that means if you don’t have any income, you don’t get any credit cards.

“It was really intended for young people who were just getting out of college and establishing huge amounts of credit lines and getting in over their heads. Unfortunately, it had a much bigger net than it was ever intended to,” she said. That net includes stay-at-home parents like Jenn, who just months ago, could claim household income and have no problem getting a credit card. “If she doesn’t have income now, she’s out-of-luck,” Levit warned.

Retailers are not happy about this either. They make money by offering discounts to shoppers who open instant credit cards and stay-at-home parents are a large part of their customer base. But that instant credit is just the kind of lending that some consumer groups believe gets people into trouble. That’s why the National Consumer Law Center and Consumers Union both support the ability to pay rule.

For Jenn it’s about fairness and family values. “You have a working parent who is bringing home the dollar income, but you also have this other parent who is contributing. I feel as though the federal government is placing a zero value on my contribution here,” she said.

Women’s groups say this regulation could be crippling for those who are widowed or divorced. Some members of congress agree so there might be some changes coming down the road.

Comments (10)
  1. miley says:

    whats to stop them from buying something and then not paying, its not like the credit card could go after the husband since the card isnt in his name. I think the law makes perfect sense. If you want to buy something and you have such a nice financial situation have your husband give you some cash and then go shopping

  2. just me says:

    This is not a matter of family values. I agree with Miley what is to stop a stay at home parent from going nuts with the charges not paying and hiding them from the working spouse.

    Wake up no income is no credibility.

  3. response says:

    “requires lenders to consider a person’s ability to repay what they borrow”
    If this had been in effect in the 1990’s, we wouldn’t be where we are today!
    If you have no income, you should not be applying for a credit card or any type of loan, as you have no way of paying it back.
    If this women wants, bring her husband to the store and have him complete the credit application as a joint account.

  4. Second Class Spouse says:

    I built up good credit prior to staying home, why should I lose it? I’m not going to ruin it after all these years. Like anyone else, I won’t charge what we can’t afford. In many cases it’s actually the stay-at-home parent that pays bills week to week and handles the accounting.

    My good credit is evidence that despite not having an personal income, I’m still good with my husband’s money working within our budget. I’m sure a retail establishment could trust me with a line of credit for a few hundred dollars. If a store denied me credit on the basis I had no personal income, I would NEVER EVER go back!

  5. Mom taking action says:

    @Second Class Spouse….thank you completely agree. Within a marriage, the decision to have one parent stay home is one that is made as a HOUSEHOLD. The contribution that parent that stays home is making is HUGE—and should not be devalued. There merely needs to be a specification within this new law as to whom can claim household income. If there is a stay-at-home spouse racking up debt and hiding it…well, that is an issue within the MARRIAGE not for the fed gov’t.

  6. Just sayin says:

    Seems to me this also hurts the stay at home mom in an abusive relationship. Would be nice if she could get a credit card to help her get out.

    1. Frank says:

      wow! really? your going to stretch this story out and go as far to try and connect it to abusive relationships? it also hurts teenagers too, how are they supposed to buy their video games? Their dad is bringing in money so why cant that count towards his income and get a credit card as well?

      This whole issue is really part of whats wrong with this country as a whole, it can be described with one saying: sense of entitlement. A credit card is a LUXURY not a RIGHT. People think they are entitled to something if it is given to someone else, well guess what not in a free market. There is no reason a credit card company should have to give a card to someone if they don’t think they should. I certainly wouldn’t loan someone money if they had no job because there is no way to guarantee you are going to get your money back. If you want to be a stay at home parent you have to understand that there are going to be some drawbacks and unfortunately one of those is having no more credit, if it meant that much to you then get a card before you quit your job or don’t cancel the ones you had before it.

      1. Mom taking action says:

        @ Frank. yes, we do live in a free country and a credit card is a luxury to those that have earned it. Establishing a career,excellent credit history, and then CHOOSING to stay home with your children—a choice that is made as a HOUSEHOLD—is a free choice that many people make. Again, it is a decision made as a couple, in a MARRIAGE. the point of this is not to hand out credit cards to everyone. It is making a specific and very valid point that the stay at home parents who in fact are CONTRIBUTING to the functioning and success of that household—and who with the WORKING spouse decided to do that–are unfairly left in a very unfortunate situation. should the working spouse become uncapble, or in a situation of divorce, widow, or sadly, domenstic violence they are left potentially unable to meet financial obligations (in the short run, until they get on their feet) and care for their family. the reality is that no stay at home parents could have planned for this–who knew this would happen! Bottom line: a decision made within a marriage—to have 1 spouse stay home and raise children while the other contributes by going to work—should stay exactly that…a MARITAL issue, not one of the gov’t.

  7. SRG says:

    I am suppose to feel sorry after the financial mess wiped many of us out. Why dont we just give every one an ATM card even if they dont have a bank account? Get real WBZ.

  8. Dan says:

    The fix is to consider the household income as joint income. Don’t just ignore someone’s ability to repay.

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