In other words, do they have a reliable and steady income?
The Credit Card Act of 2009 requires credit card companies to take “the ability of the consumer to make the required payments” into account when deciding whether to approve an application.
A 2013 amendment to the federal regulations surrounding the Card Act by the CFPB expanded the definition of one’s ability to pay so that people 21 and older can include any income to which they have a “reasonable expectation of access.” This can include income from a spouse, partner, or other members of your household. It can also include nonwage income such as savings, trust fund distributions, unemployment compensation, and others.
This also includes any anticipated income as long as it falls under “reasonable expectation of access.” If you were recently hired for a new job at a set salary that hasn’t yet begun, then you can include the salary. But you can’t write that you earn fifty million dollars a year because you bought a lottery ticket and you hope on winning.
Borrowers over 21 can list any income to which they have “reasonable expectation of access.” This broad definition includes:
Household income is not limited to your spouse or partner. It can even include other family members, such as those in multigenerational households.
For example, someone who lives with an adult child, with their parents or even grandparents could also include any income used by the household.
And as with your own income, you can count all of the sources of income from each member of your household, so long as you have a reasonable expectation of access to this income to pay for your credit card bills.
Borrowers ages 18-20 can report only independent income, which typically includes:
Banks and credit card companies may ask you for your:
Annual net income is the amount of money you make in a year after all deductions and taxes are subtracted out. If they don’t ask for net income, then you should assume they are asking for your gross income which is your income before deductions and taxes.
The Capital One Venture card application says income can include:
The Chase Sapphire Preferred application mentions examples of income you can include such as:
The Amex Blue Cash Preferred card says you can include these items in the total income field:
The Citi Prestige application says you can include these items in the total income field:
Yes, you can, but it’s an extremely rare occurrence. Here is the one case we found.
Rochester Man Sentenced for Loan Application Fraud
U.S. Attorney’s Office Western District of New York November 19, 2012
ROCHESTER, NY—U.S. Attorney William J. Hochul, Jr. announced today that David P. Gaylord, 52, of Rochester, New York, who was convicted of bank loan application fraud, was sentenced to time served and five years’ supervised release and ordered to pay $46,914.73 in restitution by U.S. District Judge Charles J. Siragusa.
Assistant U.S. Attorney Tiffany H. Lee, who handled the case, stated that in 2006, while residing in the Western District of New York, the defendant submitted various credit card applications to Advanta Corp., Bank of America, and Family First Federal Credit Union. Gaylord knowingly provided false information regarding his income in order to obtain lines of credit from the banks and credit union. The defendant indicated that his income was anywhere between $90,000 to $122,000 when, in 2006, he reported to the Internal Revenue Service that his income was approximately $12,488. Gaylord ended up leaving outstanding balances on the various lines of credit and filed for bankruptcy.
The sentencing is the culmination of an investigation on the part of special agents of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Christopher M. Piehota.
Frequently asked questions