Biden administration proposes ban on medical debt on credit reports

(US Media Group) – The Biden administration is taking action to help millions of Americans by proposing a ban on medical debt from affecting credit reports. On Tuesday, Vice President Kamala Harris and Consumer Financial Protection Bureau Director Rohit Chopra announced the plan, which aims to make access to purchasing a vehicle or home more attainable. The proposed rule, first introduced in September, could have a significant impact on Americans’ credit scores. Currently, medical debt can lower a person’s credit score, making it more difficult to obtain loans or credit cards. “Our research shows that medical bills on your credit report aren’t even predictive of whether you’ll repay another type of loan. That means people’s credit scores are being unjustly and inappropriately harmed by this practice,” Chopra told ABC News in an interview conducted last year. According to data from the Consumer Financial Protection Bureau, approximately 43 million Americans have medical debt on their credit reports, with an average balance of $429. This can be especially damaging for lower-income individuals and families. With the proposed ban, medical debt will no longer be factored into credit scores, giving individuals a fair chance at accessing credit and improving their financial standing. The...