August 9, 2022

Medical Debts to be Removed From Credit Reports

With the terrible economy, high unemployment, and loss of health insurance,  there are lots of people who have their credit score negatively affected by medical bills.

This is happening more and more considering the fact that the United States economy has been in disarray for the past several years. People are constantly struggling to get ahead and medical bills being listed as blemishes on a credit record can stop people from reaching their full potential.

There has recently been a proposal by Rep. Heath Shuler that would require that the three credit reporting agencies delete any medical debt of up to $2,500 within 45 days of the bill being paid off.

Right now when you have a medical debt it stays on your credit report for seven years even if you pay it off before then.

The bill has not yet been sent to the Senate, but supporters of it are hoping to see it voted on as early as the fall. If this is approved there are many people who would qualify for loans and credit cards that they were not formerly eligible for.

Opponents of the bill feel that taking medical debt off of credit reports gives credit card companies a false impression of the type of person that they are lending it to.

The main reason why credit reports are checked are so that lenders can see if the borrower usually pays debts back in a timely manner. Opponents feel that not having medical debt available on a credit report will lead to lenders not being paid back when they should.

While that may be a valid point, there are many people who cannot pay back bills right away because they have illnesses that require them to seek expensive medical treatments on a regular basis. Supporters of the bill feel like these people should not have a problem qualifying for mortgages and things of that nature because of something that is beyond their control.

In CNN’s coverage, a consumer credit specialist weighed in on the topic and he says that he believes the real problem is the fact that hospitals are not working with their customers enough to figure out why they have fallen so far behind.

Read more:
CNN Money
Unpaid Medical Bills Can Ruin Your Credit
Unpaid Medical Bills Can Negatively Impact Credit
How Medical Bills Affect Your Credit

Credit Repair: Know Your Rights and How To Spot A Scam

“We have all heard the old adage “”If it seems too good to be true, it probably is,”" and that applies to just about everything in life, including credit repair. According to statistics, Americans, as a whole, are over $1.2 billion in debt. With that number, that averages to approximately $5,000 for each American citizen. What is even more surprising than that is the fact that this is non-mortgage debt, so the estimated number would be even more than that staggering figure.

With the amount of money that each American is in the hole for, it is no wonder that more and more people are looking for ways to get out. There are too many reasons to list why there is so much debt, but the fact remains that we are. The reasons can be anything from job loss to excessive spending, but that does not change the fact that many people are trying to find a way out.

When it comes to repairing one’s credit, there are very many things that people are not even aware of. Offers of credit repair services are on the internet, on our television sets, and in our mail boxes. It is not hard to see why so many people are using these companies. Their claims of restoring one’s credit is very appealing to anyone trying to purchase a car or home, or even find employment. What people do not realize is that anything these companies can do for it’s customers can be done by the customers themselves for free or a fraction of their preposterous fees.

According to the Federal Trade Commission’s website, there are not only ways to help yourself to improve your credit score, but also ways to spot companies who do not have your best interest in mind. The Credit Repair Organization Act gives a few ways to recognize if credit repair companies are legitimate or not. Companies requiring payment up front for the services they provide and those who do not inform you of the things that you can do on your own to repair your credit are not legitimate. Another big no-no that should send up a red flag is the company’s advising customers to apply for an Employer Identification Number to use instead of a Social Security number in an attempt to invent a new identity. If the company should tell you to not contact any of the three major credit reporting companies yourself, steer clear. Boasts and promises of being able to rid you of all of your negative credit information, including current and accurate information, should also be an indicator of non-legitimate business practices.

According to the Fair Credit Reporting Act (FCRA), every individual is entitled to one free credit report from each of the three major credit reporting agencies once during every 12 month period. Individuals are also eligible for free credit reports if they are unemployed and are planning to look for employment within the following 60 day period.

Americans trying to get ahead, become debt free, and enjoy a better life should really take heed and avoid getting taken advantage of. After all, it is our credit that we are dealing with, and we always have our best interests at heart, so taking control of repairing it should be our responsibility first.”

Additional information at:

Federal Trade Commission

Credit Repair: How To Help Yourself

Family Debt-Statistics

An Introduction To Credit Repair

Having a bad credit rating makes it difficult to get loans or make purchases that require long-term payments. Once a person’s credit rating is determined it seems as if nothing can be done about it. The very first thing that must be done before credit repair can even be started is to get a copy of one’s credit report.
Credit Repair

Under Federal Legislation, credit reporting companies, must supply anyone who asks, a copy of their credit report. This report shows a credit rating as well as reports that have been sent in regarding your dealing with different businesses. Although the various companies such as Equifax, Experian and TransUnion, might have a slightly different score, the one company that has the combined totals of all companies is FICO (Fair, Isaacs & Co). FICO takes the ratings from all the companies, combines them and comes up with a final rating.

A credit rating can range from 300 to a perfect score of 850. Lenders consider score of 690 to 720 as excellent, with 723 as the median. A score below 620 is considered risky and might cause one not to get a loan or item that requires payments.

Many times, there are mistakes on a person’s credit report. This is why it is important to obtain a copy each year and check what has been reported. Errors are made by banks and people doing business, which reflects on that report. In addition, identity theft has caused havoc with people’s credit as well as their reports.

If a mistake is found on the report, the first thing a person should do is contact the merchant, or bank, which sent in a negative report. One should not try to do this by phone, talking in person and getting something in writing is important. If they agree there is an error, this proof is paramount for the long process that is required to clear up such a problem. Taking any receipts or other proof, to the meeting, is essential, however the originals should never be surrendered. Let them make copies if they ask for them.

The next thing a person should do is contact the credit reporting agency. This will be by registered letter with a return receipt requested. The letter should state that one disagrees with the report, list the reasons, add that the lender or merchant has been contacted and enclose copies of any receipts.

If a person is in the right, and has proof of regular payments, payment in full or whatever the negative report is about that should be the end of the matter and bring a change in the credit report. If it does not one can always contact a lawyer which, unfortunately, is usually quite expensive. Many people have solved their problem by filing a consumer’s complaint with the state’s attorney general’s office.

When this is done, that office will contact both the person filing the bad report and the credit rating company, asking for an explanation as to why the matter has not been cleared up. Most people do not have to go this far but, on occasion, it does happen. There are a number of companies, on the Internet, that advertise they do credit repair. As with any other business one deals with, it is important that their credentials be checked carefully, ask for references and take every precaution to be sure it is a reputable company.

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