Salt Lake City, UT (PRWEB) March 16, 2015
Lexington Law, a consumer advocacy law firm and trusted leader in credit report repair, responds in favor to the agreement announced on Monday by Equifax, Experian and TransUnion, to adopt major changes that aim to improve consumers’ credit scores.
Among other things, the agreement addresses late medical-bill payments and the handling of customer complaints. Under the new agreement, set to take effect within the next several months, the credit reporting agencies have agreed to delay inclusion of any unpaid medical bills in a credit report for six months, giving both consumers and insurance companies more time to take care of payment. Additionally, consumers will no longer have to wait for the medical debt to be removed from their credit report. Credit reporting companies will erase the item after the debt has been paid.
“This agreement codifies what consumers have known all along about medical debt. Just when you think your insurance company is finalizing a payment, you suddenly find that the bill has been sent off for collections,” said Dr. Randy Padawer, consumer advocate for Lexington Law. “That single event can destroy your credit score, financial reputation, and ability to qualify for a new car, home, or even a credit card. Even worse, since so many prospective employers check credit reports these days, this can even negatively impact employment.”
More than 43 million Americans have delinquent medical debt on their credit reports, according to a recent report by the Consumer Financial Protection Bureau (CFPB). This amounts to one in five credit reports being adversely affected. Moreover, the CFPB found that some 15 million consumers would have no collection items on their credit reports if not for the medical debt on these reports.
Padawer continues, “Going forward, the six-month delay in credit reporting for medical debts will likely protect a good number of consumers from these kinds of abuses.”
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