Medical Debts Disappearing From Credit Reports

Equifax, Experian, and TransUnion said in a joint statement that they will be removing 70 percent of all medical debt off of credit reports.

Beginning July 1, 2022, medical debt that has been paid off will be deleted. Those negative medical accounts that show late payments, as a collection, or a charge-off will automatically disappear. No letter from you required!

More Good News

Beginning early 2023, medical debts with a balance less than $500 will not be included on a credit report.

This is great news, because a $2 debt that shows late hurts your score as much as a $2,000 debt. It is the late factor that docks you, not the balance. No more credit score punishment for small medical collections!

The Reason for the Change

In light of the recent pandemic, the credit bureaus do not want to penalize people who incurred medical expenses, were unable to pay for awhile, but then got caught up and paid.

It was determined — and rightly s0 — that those people do not impose a risk for lending credit. Therefore, they should not have their credit scores decreased for paid medical debt or small debt.

Beware: This Does Not Cancel Your Medical Bill

Notice that the negative accounts that will be deleted are those with a $0 balance. This does not mean you don’t have to pay a medical bill.

If you have a balance owing, now would be the perfect time to negotiate a settlement per Chapters 15 in Repair Your Credit Like the Pros (here). You don’t even have to get the agreement for the collector to remove the account upon receipt of payment now, because the credit bureaus will delete it July 1st. Easy-peasy!

Thank you and please “Like” and pass on to others who could be encouraged by this information!

2 thoughts on “Medical Debts Disappearing From Credit Reports

  1. Awesome news and update! Thank you Carolyn for keeping us in the loop and the practical tips shared.

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