Biden Administration Proposes Wiping Medical Debt from Credit Records [Video]

The Consumer Financial Protection Bureau (CFPB) put forward a rule Tuesday barring any medical debt from appearing on credit reports, a move that would affect some 15 million people, according to the bureau. The rule, if finalized despite opposition from debt collectors, would go into effect early next year, bureau officials said on a conference call with reporters.

The rule, first announced last September, would wipe away old medical debt from the reports and ban the reporting of new debt, raising credit scores and making it easier for people to access mortgages, business loans, and other credit. The three major credit bureaus already have voluntarily taken medical debts under $500 from credit reports, so the new rule would affect the remaining, larger balances.

“Usually, medical debt is the result of a medical emergency, …