The government reports more than 43 million Americans have medical debt on their credit reports. But help is on the way this summer for those who can’t get out from under this.
The three big reporting agencies July 1 plan to erase about 70% of medical debt from credit reports. This is huge news as affects about $88 billion again of medical debt on credit reports.
Debt of any kind can stay on your credit report for seven years affecting your ability to rent a home, buy a car and more. So eliminating, again, 70 percent of medical debt on credit reports will help.
Management at TransUnion, Equifax, and Experian recognize that this type of debt isn’t planned. You have to tend to a heart attack or a broken bone. And with the rising cost of health care, something had to be done to help families survive the weight of this debt. It’s not like charging a third pair of boots because you just like boots, and then not paying off the credit card.
And with that, there’s more good news coming. Consumers will have a year to pay off medical debt before it even appears on a credit report. Lastly, in 2023, any unpaid medical debt under $500 won’t be reported or posted as part of your credit score.