Like a handful of banks before it, Chase announced joint credit cards are no longer an option for its customers. Existing accounts won’t be affected, and cardholders can still add authorized users to their accounts.
While some consumers may see this as fewer products to choose from, the change shouldn’t impact someone’s access to a credit card. The CARD Act, which went into effect in 2011, instructed card issuers to consider a consumer’s income when processing a credit card application. This initially hampered stay-at-home spouses’ ability to get credit cards in their own name. The Consumer Financial Protection Bureau made an adjustment to the act last year, which allows an applicant’s household income to be taken into account.
In an email, Chase Director of Public Relations Steve O’Halloran said the move was part of the bank’s effort to continually “simplify our offerings to customers.” The bank joins several other institutions that discontinued or never offered the feature.
The Benefits of Joint Credit Card Accounts
Joint credit cards allowed couples to build credit with one account, but one can also build credit by being an authorized user on a spouse’s account, too. If the joint accountholder is a spouse, then generally it must “count” the same way for credit scoring purposes as required by Equal Credit Opportunity Act. If you already have a joint account, it may not make sense to close it unless you think you are at risk, for example, of splitting up with your spouse or partner who is the other account holder (but more on that later).
Jason Steele, a Credit.com contributor who specializes in credit cards, said some cardholders may be disappointed in Chase’s decision if they are, “told that they cannot dispute a charge, or report a card lost or stolen, because he or she is not the primary account holder.”
But couples can take advantage of separate cards, he added. For instance, they could earn two sign-up bonuses by applying for the same card and maximize the benefits of their joint finances.
The Risks of Joint Credit Card Accounts
Individuals shouldn’t overlook the importance of having their own credit cards. For one, if someone’s only credit card is an authorized user card from their spouse’s account, they could find themselves without a card if the primary cardholder removes them from the account or dies.
The possibility of such occurrences beyond a consumer’s control is why individuals should have at least one credit card in their name, according to Credit.com’s Director of Consumer Education Gerri Detweiler.
Plus, joint accounts can be a pain if happily ever after doesn’t work out.
“In a divorce, one spouse may be assigned the debt in the divorce decree, but if they don’t pay it, the other spouse is often shocked to learn they are still on the hook,” Detweiler said. “It’s usually easy to remove an authorized user, but if you want to remove a joint accountholder, you must typically pay off and close the account — then open a new one.”
For consumers looking to get their own cards, it’s crucial for them to understand their financial situation. Access to certain credit cards and their benefits depends on credit history and credit score, so before card shopping, an individual should gather their credit information — including their credit score (which they can get for free using a tool like Credit.com’s Credit Report Card) and their credit reports. With that information, people can search for credit cards that best meet their needs.