Do you have a lot of medical debt in Tennessee? If so, you may be interested in a new national initiative by the three major credit reporting agencies. If the move is successful, it may wipe up to 70% of debt off of consumer credit reports. This is a major development.
What does this mean for your credit?
If you are currently struggling under the weight of medical debt, some much-needed relief may be coming your way. Starting on July 1, 2022, medical debt that was paid after being referred to collections will be removed from reports.
This is a move that stands in stark contrast to the way that these issues used to be handled. Previously, your medical debt, once sent to collections, would stay on your credit report for a period of up to seven years. This was even after you had paid it off.
One minor detail to note is that your unpaid medical debts that occur after the new rules take effect on July 1 will not be added to credit reports right away. They will, however, be added after a full year has passed since these debts were referred to collections. This will give you room to breathe.
What other changes may be taking place?
You should be aware that a major reduction in medical debt is not the only major change that is being mulled over. A number of other moves are planned in order to bring relief to a population that is drowning in credit card debt. These are moves that may be able to help you from having to declare bankruptcy or adopt other desperate measures.
One of the most promising changes planned for next year will be removing medical debts of $500 or less from your credit report. This will be done by the three major credit reporting agencies. The move itself is set to be put into practice fairly soon, but it should be noted that the dollar amount is subject to change.