Texas residents may be surprised to learn that around 43 million Americans have medical debt on their credit reports, and about a third of them have otherwise excellent credit. The importance of FICO scores makes removing negative items from a credit report a matter of some importance, but it can be a time consuming and frustrating process. Debt collectors often set medical bills on a credit report before they are sent to consumers, and these bills may continue to negatively affect FICO scores even after they have been paid.
This kind of dubious practice led the New York State Attorney General to begin investigating the major credit bureaus in 2012, and Transunion, Experian and Equifax announced on March 9 that they have implemented a number of changes in the way that medical bills will be treated. The bureaus have agreed to wait 180 days before adding medical debts to a consumer’s credit report, and they will assign trained staff to review disputes. The changes will be phased in nationwide over the next six months.
A 2013 study by the Federal Trade Commission revealed that mistakes are present on the credit reports of one in five Americans, and these errors often do not come to light until a loan has been denied or a job application has been unsuccessful. The settlement between the major credit bureaus and the New York State Attorney General follows an August 2014 announcement by FICO that paid medical bills would no longer negatively affect credit scores.
Struggling to cope with unmanageable debt can place a great deal of strain on a marriage, and spouses who are contemplating a divorce are often surprised to learn that debts accrued during a marriage may be divided in the same way as assets. An attorney experienced in these areas may be able to explain the various legal options available.