Consumers who suffered credit score damage because of a small but burdensome amount of medical debt may soon receive some relief.
U.S. Rep. Heath Shuler recently introduced the Medical Debt Responsibility Act of 2011, which would give credit reporting companies 45 days to remove any paid or settled debt amounting to $2,500 or less per collection from a person's file. Current federal guidelines allow for paid or settled medical debt to linger on a credit report for up to seven years.
Shuler says H.R. 2086 could help protect numerous Americans from enduring bad credit because of a small medical debt.
"By keeping cleared medical debt off of credit reports, this bill will allow more Americans to have the credit score they deserve and need to buy homes and stimulate economic growth in their communities," he said.
The way companies report their customers' credit account information can play a major role in a person's credit score. For example, a lender that mistakenly says a customer's account is delinquent when it's current can cause that person's three-digit number to plummet.
For this reason, it's important for consumers to check their credit reports regularly and review the listed information carefully. Any mark that appears in error or against federal reporting guidelines can be challenged and potentially removed. Clearing these negative marks may provide people with the credit score help they need to qualify for more affordable financing offers.