Legislation Would Give Consumers 120 Days To Resolve Medical Debts Before Dinging Credit Reports

Some of the homeowners from San Jose and Sunnyvale that work with ForeclosureHelp are struggling with their mortgages in part because of medical debt and medical bills. Damaged credit can also be an issue if you’re trying to refinance. This post from the Consumerist highlights recently introduced legislation that would give consumers 120 days to resolve medical debt with collectors before that debt is reported to the credit bureaus.


Consider the following: 1-in-10 insurance claims are processed incorrectly; debt collectors are using account information that may be incomplete, inaccurate and out-of-date; once reported to a credit bureau, medical debt — whether real or erroneous — can do severe damage to your credit score. Perhaps it couldn’t hurt to give consumers a chance to challenge or resolve medical debts before collectors report them to the credit bureaus?

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