Have you ever found yourself buried under a pile of medical bills? Trust us, we feel your pain – it’s a total nightmare!
Unlike credit card debt, you don’t exactly choose to rack up medical expenses. You can’t exactly plan for a sudden illness or accident that lands you in the hospital and leaves you with a hefty bill. And the worst scenario is that you can’t even anticipate what your insurance will cover and what you’ll be stuck with. But don’t worry, here’s some good news for you!
In the past, paying off medical debt didn’t necessarily improve your credit score. Medical debt could even stay on your record for up to seven years! Luckily, now medical debt under $500 and the ones already paid off are taken off your credit report. If you are also the one who wants to maintain a great credit score, even after dealing with medical bills? And someone who keeps wondering, “Where can I find a credit repair near me?”
Look no further! We’ve got some tips for you – keep reading to find out more.
Related: Top 10 Best mobile wallet apps for Android
Big News!
So, here’s the exciting news on the credit front! The big three credit bureaus (Equifax, Experian, and TransUnion) have made some changes that will benefit millions of people. Starting July 1, 2022, paid medical debt will no longer be reported on credit reports. Plus, as of April 11, 2023, medical debt under $500 won’t be reported either.
Note: These changes are voluntary and not mandated by the government). According to the Consumer Financial Protection Bureau, these changes could boost credit scores for about 15.6 million people by up to 25 points. Fantastic news, right?
Understanding the Impact of Medical Debt on Your Credit
Now let’s talk about unpaid medical debt, it can have a negative impact on your credit report for up to 7 years. However, there are ways to remove those bad marks earlier and improve your credit score. Let’s explore your options.
Related: How to become financially independent as a teenager?
Steps to remove medical debt from my credit report!
Did you recently spot a medical debt on your credit report that doesn’t belong to you? Don’t worry! You can easily get rid of them by following these simple steps.
1- Reviewing Your Credit Report
Well! The process to remove your medical debt from your credit report starts with reviewing your credit report. Make sure you get a copy from Equifax, Experian, and TransUnion – the big three credit bureaus. Take a close look and hunt down any medical debts listed.
2- Dispute an error
Carefully scrutinize your credit report for any medical debt errors. If you spot any, write a dispute letter and send it to all three credit bureaus.
Don’t know how to write a dispute letter? Take a look at the Consumer Financial Protection Bureau’s sample letters. They’re super helpful and make the process a breeze. Start correcting your credit report today!
3- Negotiate with Healthcare Providers
Once you have validated your medical debt, now it’s time to negotiate! Don’t be afraid to explore options and advocate for yourself. Consider setting up a payment plan, negotiating a reduced settlement amount, or requesting a pay-for-delete agreement. And remember, always get an agreement in writing before making any payments!
4- Settle Medical Debt
If you’ve tried negotiating but still can’t reach a fair agreement, settling your medical debt might be the way to go. You can make a single payment to the healthcare provider or collection agency in exchange for your debt being marked as “paid in full” on your
credit report. Just make sure to ask for any negative remarks tied to the debt to be removed too.
5- Get Down Medical Debt Under $500
Starting January 1, 2023, medical debt below $500 will be automatically erased from credit reports. So, if you have any eligible debt that is not removed, you can dispute it as an error. Simply, say goodbye to pesky medical bills dragging down your credit score.
6- Seeking Professional Assistance
Are you finding the process of dealing with medical debt overwhelming or you are facing challenges in removing it from your credit report?
Consider seeking professional assistance! Credit counseling agencies or reputable credit repair companies can provide guidance and support throughout the process.
7- Building a Healthy Credit Profile
Once you have successfully removed medical debt from your credit report now, it’s time to work on building a solid credit profile. Here’s what you need to do: pay your bills on time, stay away from excessive debt, and keep your credit card balances low. Once you stick to these good financial practices, you’ll see your credit score gradually improve.
Let’s do this!
The Road to Clear Credit
Removing medical debt from your credit report requires patience, persistence, and proactive measures. Following the above steps can take you on the path to healthier finance. All it takes is a little patience, persistence, and proactivity. Check out this article for a step-by-step guide on how to remove medical debt from your report. And don’t forget to stay on top of things by regularly monitoring your credit report – it’s a small step that can make a big difference!
