One of the lesser-known or talked about changes of the CARD act of 2009 is that credit card applicants under age 21 are now required to have enough income to support the credit card or have an adult act as a co-signer on the account.
However, a problem arises because there is no standard income level for the young adult to get approved for the card. There is also no standard in place for proving income.
Therefore, a young student may be able to get a card without really having the ability to pay the credit card back. While they may be required to provide income verification, with no requirements on how much income is necessary, some may just be able to slip on through. And though a young student will be held responsible for the debt they accrue, the temptation of easy credit may still be there and that temptation could easily override the financial responsibility that is necessary to responsibly handle a credit card.
Also, if a parent does co-sign, there is no standard on when they can be removed as a co-signer. In fact, they may be committed to being the co-signer for the duration of the credit, which could feasibly keep them on the hook forever. The banks and credit card issuers have no incentive to release the co-signers from responsibility so it may just not happen.
Flaw Remains In Credit Reform