Unpaid medical bills will no longer appear on credit reports, where they can block people from mortgages, car loans or small business loans, according to a final rule announced Tuesday by the Biden administration.
The Consumer Financial Protection Bureau rule will remove $49 billion in medical debt from the credit reports of more than 15 million Americans, according to the bureau, which means lenders will no longer be able to take that into consideration when deciding to issue a loan.
The change is estimated to raise the credit scores by an average of 20 points and could lead to 22,000 additional mortgages being approved every year, according to the bureau. Vice President Kamala Harris said in a statement announcing the rule that it would be “lifechanging” for millions of families.
“No one should be denied economic opportunity because they got sick or experienced a medical emergency,” she said.
Harris also announced that states and local governments have used a sweeping 2021 pandemic-era aid package to eliminate more than $1 billion in medical debt for more than 700,000 Americans.
The administration announced plans for the rule in fall 2023.
The CFPB said that medical debt is a poor predictor of an individual’s ability to repay a loan. Experian, Equifax and TransUnion, the three national credit reporting agencies, said last year that they were removing medical collections debt under $500 from U.S. consumer credit reports.
The new rule from the Biden administration is set to take on the outstanding bills appearing on credit reports.
Related Posts:
- Biden, in 11th hour action, bans new offshore oil and gas drilling in most federal waters News By MATTHEW DALY, Associated Press WASHINGTON (AP) — President Joe Biden is moving to ban new offshore oil and gas drilling in most U.S. coastal waters, a last-minute effort to block possible action by the incoming Trump administration to expand offshore drilling. Biden, whose term expires in two weeks, said…
- Biden, in 11th hour action, bans new offshore oil and gas drilling in most federal waters News By MATTHEW DALY, Associated Press WASHINGTON (AP) — President Joe Biden is moving to ban new offshore oil and gas drilling in most U.S. coastal waters, a last-minute effort to block possible action by the incoming Trump administration to expand offshore drilling. Biden, whose term expires in two weeks, said…
- Nippon, US Steel file suit against Biden administration, union, and rival after $15B deal scuttled News WASHINGTON (AP) — Nippon Steel and U.S. Steel filed a federal lawsuit challenging a Biden administration decision to block Nippon's proposed $15 billion acquisition of the Pittsburgh company and said that the head of the Steelworkers union and a rival steelmaker worked together to scuttle the buyout. Biden said Friday…
- Kim Jong-Un ‘bans North Koreans from eating hot dog soup’ News Hot dogs are reportedly seen as too Western in the dictator’s eyes (Picture: Getty Images) Kim Jong-un has reportedly banned North Koreas from eating hot dogs because they’re too Western. The despot decreed that anyone caught serving them at home or selling them in the street is committing treason. Offenders…
- Iconic Instagram beach beauty spot BANS influencers taking pics on precarious cliff edge over fears of tragic falls News AN ICONIC cliff-side beauty has banned visitors over fears selfie-seeking Instagram influencers will fall to their deaths. Surfer’s Rock, which juts out over Lagoinha do Leste beach in Brazil, used to attract tourists who would wait hours to capture the perfect photo. Influencers and tourists are seen at Pedra do Surfista…
(Visited 1 times, 1 visits today)