Women Battle Bias

Christine Carroll, 32, of Floral Park, N.Y., would appear to be a solid financial asset to any marriage. Steadily employed as a bookkeeper for the past decade, she regularly contributes $4,000 a year to the Carrolls' combined income of $16,500. Yet for three years she and her husband Richard were turned down for a mortgage loan by one lending institution after another. His income alone was not sufficient, the couple was invariably told, and her income could not be counted because she was "of childbearing age." When one loan officer asked Christine for documentary proof that she was infertile, the Carrolls filed a complaint with the state's Division of Human Rights. The case was eventually dismissed, but not before one of the banks relented and gave the Carrolls a loan.

Christine was luckier than most women. Married or single, working or not, women in the U.S. suffer discrimination in the granting of credit. Banks, retail stores and credit card companies are generally reluctant to allow a married woman to open a line of credit on her own, and they often wipe out a woman's credit rating entirely when she marries or becomes widowed or divorced. Says Barbara Shack of the New York Civil Liberties Union: "Credit has become the American way of life, and women have been systematically excluded from the credit society."

Only recently has this double standard been examined in detail. The U.S. Savings and Loan League last year surveyed 421 member institutions and found that 72% would ignore all or part of a wife's income in making a loan decision. In St. Paul, the city's Department of Human Rights discovered that when a man and a woman of the same creditworthiness applied for a $600 auto loan, nine of 23 local banks gave preferential treatment to the man. A public-interest research group in Oregon has published a 74-page study accusing the state's major banks and retail stores of consistently underrating women as credit risks.

Lenders have long contended that women are transients in the work force, dropping out periodically to have children and sometimes never returning.

Women's salaries are still generally lower than men's, they note, and state laws are often vague about when a woman can be held responsible for her debts.

But such creditors ignore important changes in the economic status of women. Nearly 40% of all wage earners today are women--up one-third from 1951--and close to one-third of adult women are full-time members of the work force. Says Michigan Democratic Representative Martha Griffiths: "The idea that wives of childbearing age are unreliable borrowers is a myth. Most women have control over whether they will become pregnant."

Right now there are five bills before Congress that would outlaw sex discrimination in lending. The state of Washington this year adopted such a measure, and at least four other state legislatures are considering similar ones. In mid-May, the National Organization for Women (NOW) and two other rights groups petitioned the Federal Reserve Board to start questioning the credit policies that the banks it supervises maintain toward women. And two groups of financiers, both men and women, are applying for charters to open banks in New York City that would give special consideration to the credit needs of women.

The message has begun to sink in.

National BankAmericard this year asked member banks not to require applicants to submit financial information about their spouses, and to let single women keep their accounts when they marry. A number of department stores --including Boston's Gilchrist Co., Oregon's Meier & Frank, and New York's B. Altman & Co.--have begun allowing all married women to open charge accounts in their own first names and on their own credit references. New York's First National City Bank has appointed a woman to monitor its credit practices, and will now accept alimony and welfare income as proof of ability to repay a loan.

Still, a gap sometimes yawns between the equal-lending policies that senior executives proclaim and the credit practices that underlings follow. Thomas Hayne, senior vice president at Chase Manhattan Bank, saw the Carrolls on a television program describing their mortgage problems, so he wrote them that "it has long been Chase's policy to take into account total family income in determining a family's ability to borrow." He enclosed a mortgage application. The gesture was a bit late; Chase already had turned the Carrolls down.

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