Medical Bills to Be Removed From Credit Report Under Biden Administration
According to the Consumer Financial Protection Bureau (CFPB), medical bills account for 58% of all third-party debt collection on consumer credit reports. This debt can make it difficult for consumers to purchase homes, qualify for loans, and have a negative impact when looking for employment. The Biden Administration hopes to reduce that, however, with its plan to have medical bills removed from credit reports.
Medical debt is the most common form of debt collection and its complex nature makes it prone to inaccuracies. This causes patients who are already ill to spend precious time disputing errors for bills that they may not even owe. Research finds that medical debt doesn’t always determine a consumer’s ‘credit-worthiness.’
The proposed outline by the CFPB would prevent credit reporting agencies from including medical debt and collection information on credit reports. It also wants to ensure that only non-medical information is used when considering a borrowers’ loan application. These changes could potentially increase the credit scores of millions of Americans.
In a statement, Vice President Harris stated the following:
“No one in this country should have to go into debt to get the quality health care they need. These measures will improve the credit scores of millions of Americans so that they will better be able to invest in their future.”
What do you think of these new proposed changes?