On January 7, 2025, the Biden administration issued a Final Rule by the Consumer Finance Protection Bureau that prohibits medical debt from being considered in credit eligibility determinations. The CFPB estimates that the new rule will eliminate $49 million from the credit reports of about 15 million Americans. Proponents of the rule say that eliminating medical debt from credit reports will improve access to credit for otherwise creditworthy borrowers, while opponents argue that removing valid debts from credit reports will actually reduce access to credit by making the issuance of credit riskier. Whether the new rule will be enforced or repealed by the Trump administration remains to be seen, and Congress could also weigh in to appeal the new rule.
Biden Administration Issues Final Rule Banning Medical Debt from Credit Reports
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