A new proposal by the Biden administration would protect Americans from having their credit history cratered by medical bills.
The rule change, announced by the Consumer Financial Protection Bureau (CFPB) on June 11, would prevent almost any medical debt from appearing on credit reports. In a statement, the CFPB said medical bills “have little to no predictive value when it comes to repaying other loans.”
In 2022, the three largest credit bureaus — TransUnion, Equifax and Experian — started removing paid medical debts from consumers’ credit reports. The following year, they stopped including outstanding balances under $500.
FICO® and VantageScore, the two major credit scoring companies, have also decreased the degree to which…
