NC residents who paid off medical debt could see their credit score boost. Here’s how
Millions of North Carolina residents are affected by medical debt, but those who have managed to pay balances could see improvements in their credit scores.
More than a third of the state’s population was in collections for medical debt at the end of 2020, according to the most recent data available from the Urban Institute.
Medical debt alone, not counting credit cards, and student loans, has landed more than 2 million North Carolinians in collections, The News & Observer reported, which can hurt your credit score.
Until recently, medical debt remained on credit reports for seven years, even if it was paid off.
Now, the three large credit reporting agencies – Equifax, Experian and TransUnion – will no longer include medical debt after it’s settled CNBC reported.
RELATED: Here’s how to get help paying off your North Carolina medical debt
If you have medical debt, here are some of the other changes you can expect to see, and how to check your credit report to dispute claims.
What changes are coming to those with medical debt?
In addition to settled medical debt not being included on credit reports, consumers will get a year before unpaid debt appears on their reports after it goes to a collection agency, instead of six months, CNBC reported.
Also, in the first half of 2023, agencies will not include any unpaid debts that are less than $500 on credit reports.
How to check your credit report
You can get a free copy of your report from each of the three major credit bureaus at annualcreditreport.com or Credit Karma.
To check for medical debt that you have already paid off, it is suggested to look over the section where the report flags new debt, or the account information or collections sections of each report.
If you see any debt still on your credit report, you can dispute the information with the company by explaining in a letter what you think is wrong, according to the Consumer Financial Protection Bureau. You can also contact companies online or by phone.
If you mail a letter requesting changes, it should include:
Your full name, address and phone number
A report confirmation number, if available
Each mistake on your credit report, such as an account number for an account you may be disputing
An explanation as to why you are disputing the information
A request for the information to be removed or corrected
A copy of the portion of your credit report that contains the disputed items
Credit reporting agencies are required to investigate your dispute and report the results back to you unless they determine your claim is frivolous, the CFPB says. If your dispute is accepted, the information on all your credit reports will be updated.
This story was originally published July 7, 2022 at 6:00 AM.
