CC applications in community property states

[Moleman_H]

Hi myfico forum members,

I've been lurking on this forum since credit history/scores became a topic for me (about 6 months ago) and have been able to learn quite a bit since then. Now I do have a few questions that are more specific to my situation, so I figured I'd exit the lurking mode.

My medium-term goal is to get 2 useful cash-back CCs for my wife and have me as an AU on those. If possible, the Amazon chase Visa and eventually AMEX BCP.

The problem: I've got a well-paying job but no credit score (5 months of secured CC with 500 CL, 5-7% util, 4 months of car loan) while my wife has a decent credit score (760ish, student/car loans, older closed CCs in good standing) but no job currently. The 2009 CARD act seems to make things tough for us. On the upshot, we are living in a community property state. Legally, my income is hers also.

Does anyone here have experience with or otherwise knowledge of entering (all or half?) of spousal income on the application forms in community property states?

What about the employer field on e.g., the AMEX application? Wouldn't it look weird to list 'none' but still have an income?

And a few general questions: Would it help my credit score to up to secured cards CL and/or should I try to get a second? Would you apply for the Amazon or the BCE first?

[Anonymous]

With Amex and Citi, the app specifically asks for household income. My dh is a stay at home dad, do he makes no income. So he puts homemaker as job/employment, but uses my income as household income. He got 10,200 CL while I only got 7200 because his credit is a little better than mine!

[Creditaddict]

I think Chase you can use Household income but I think Amex wants individual but in community property state I would probably give Household income... We had a thread a couple months ago about a stay at home wife and applying for Target, I believe the outcome was that Target said use HHI and she was approved instantly.

Stay at home mom probably works harder then any of us outside the house (She earned your salary fair and square!! LOL

[CreditMuppet]

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@Anonymous wrote:
With Amex and Citi, the app specifically asks for household income. My dh is a stay at home dad, do he makes no income. So he puts homemaker as job/employment, but uses my income as household income. He got 10,200 CL while I only got 7200 because his credit is a little better than mine!

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Amex is looking for individual income on the application for any of its products, that's the dollar amount they would want  you to be able to prove on your individual tax return but it probably wont be an issue unless you have to go through F/R.

[Creditaddict]

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@CreditMuppet wrote:

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@Anonymous wrote:
With Amex and Citi, the app specifically asks for household income. My dh is a stay at home dad, do he makes no income. So he puts homemaker as job/employment, but uses my income as household income. He got 10,200 CL while I only got 7200 because his credit is a little better than mine!

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Amex is looking for individual income on the application for any of its products, that's the dollar amount they would want  you to be able to prove on your individual tax return but it probably wont be an issue unless you have to go through F/R.

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If you are married you would have a joint tax return though wouldn't you? so that would be your income as joint?

[CreditMuppet]

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@Creditaddict wrote:

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@CreditMuppet wrote:

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@Anonymous wrote:
With Amex and Citi, the app specifically asks for household income. My dh is a stay at home dad, do he makes no income. So he puts homemaker as job/employment, but uses my income as household income. He got 10,200 CL while I only got 7200 because his credit is a little better than mine!

---

Amex is looking for individual income on the application for any of its products, that's the dollar amount they would want  you to be able to prove on your individual tax return but it probably wont be an issue unless you have to go through F/R.

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If you are married you would have a joint tax return though wouldn't you? so that would be your income as joint?

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Right but doesnt that form break down the individual income on a per person basis? 
I believe Amex changed the language on its application (which DID use to be HHI) around the same time that the CARD act was introduced.

[Anonymous]

How does this factor into the laws passed in October of this year?  Here is an excerpt of an article that says if you don't have any income of your own, you cannot apply for credit:

"A federal rule kicked in Oct. 1 that will prevent many applicants from qualifying for new credit card accounts.

The Federal Reserve's rule told credit card companies that they no longer can consider household income when assessing the creditworthiness of an individual who applies for his or her own card. Under the rule, only an individual's own salary or other income -- rather than combined household income -- can be considered.

One major effect of the new regulation: Stay-at-home moms (or dads) without significant outside income no longer will be able to open their own credit card accounts -- and establish their own credit histories to build their credit scores. Compliance with the rule became mandatory Oct. 1, 2011.

"From an economic standpoint, this is a whopper," said the founder of the Women's Financial Literacy Initiative, a financial fellow at Wellesley College and a Houston-based financial analyst. "Not only will be harder to build a credit score, but this ruling is tantamount to assigning a zero dollar value to the work stay-at-home parents do day in and day out to keep households running."

Full Article can be found here.

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If you live in a community property state does that "get around" this new law?

[Moleman_H]

Thanks for all the answers!

From the article linked by discernment:

"The Federal Reserve also pointed out that in community property states -- including California and Texas -- nonworking spouses can assert joint ownership of property (including income) acquired by a working spouse. In those cases, issuers can consider the spouse's income when considering a credit card application solely in the name of the stay-at-home spouse, the board said."

So they don't have to ask for individual income in these states.

Among other things, AMEX asks for:

* Employer name, city, state, phone (all optional)

* Total Annual Income (interestingly enough, in the source code, this field is still called annualHouseholdIncome)

* Income source (options: Self-Employed, Unemployed, Employed (with sub categories), Student) with a note of: "Include income from all sources including employment, retirement, investments, rental properties, etc. Alimony, child support, or separate maintenance need not be revealed if you do not wish to rely upon it"

Not sure if my wife could really used employed as homemaker here. That does not sound like what they are looking for.

Any guesses what would happen if my wife would put (all honest, using our shared income/assets):

* nothing for employer (as that seems optional),

* unemployed

* my income (low 6 digit)

* lowish to medium 6 digit in assets (another optional field)

there? Does that scream review?

[Anonymous]

You would be best served to just ask a csr, but I'm sure my dh got his Amex while unemployed using my income. It was not a secret, and he was not being dishonest. It was done on the phone, and when you dont work outside of the home but you list 6 figures, obviously they want to know the situation. He explained and was granted the card. Up to you...good luck.

[kilj0y]

In doing my research I came across this thread and was wondering how accurate is this information for today's credit landscape.