How Does Medical Debt Affect Your Credit Score?

by Kedy J. Writer Many people make the mistake of thinking that their past due medical bills do not affect their credit score. Unfortunately, medical collections can greatly affect a credit score, even if the amount is minimal. Many people are not even aware that they have these collections on their credit report and only find out when they apply for a loan, such as a mortgage or auto loan. Understanding what affects your credit score and how is important in order to ensure that you keep your record clean and are able to obtain your desired financing when you need it the most.

Why Do Medical Debts Get Reported?

Medical debts begin to affect your credit report when they reach the point that they are sent to a collection agency. This debt is then treated like all of your other debts and shows up on your report as the inability to repay your debts. It is the responsibility of each consumer to ensure that their medical payments are accurately recorded and any insurance payments are made in a timely manner. If payments are not made, you can find out by performing a credit check. If you have medical collections showing that you do not think are valid, you should dispute them right away in order to get your credit back in check.

Medical Bills Affect your Score

Do medical bills affect your credit score? They definitely do. Any negative reporting on your credit report can cause your score to fall dramatically. This means that even if you fail to make a required co-pay or two, no matter how small the amount, it could cause your credit score to suffer and your ability to obtain a mortgage, refinance your home or obtain a personal loan impossible.

Why are There so Many Medical Collections?

Medical collections are one of the most common collections because most people are not even aware of their bills or that they are past due. Many people do not even realize that the collections exist until they check their credit score. At that point, the collections could have been sitting on their record for quite some time and could have caused serious damage to the credit score. For many people, medical bills either get confusing or come at an overwhelming time in a person’s life when they are not able to pay the bills or simply do not have the ability to understand them as they try to overcome their injury or illness. One simple overlook can cause serious issues with your credit report and financial future.

Fighting Medical Collections

Medical collections, unlike any other items on your credit report, can be very hard to fight. The new privacy laws make it very hard for anyone to determine who the collection originated from in the first place. It can take quite a bit of hard work for you to get to the bottom of where the bill originated ad whether or not it is legitimate. If you do get collection notices regarding a medical collection and you are sure that it is valid, it is best to get it paid as soon as possible. When you wonder, “do medical bills affect your credit score;” they do affect them quite a bit. It is best to pay the bill as soon as you get it, but with the agreement from the collection agency that they will remove the collection from your credit report right away. This is the only way to ensure that your credit is wiped clean and your score has a chance to increase.

If you have medical collections on your credit report, it is best to get them handled right away. Medical collections are one of the worst ways to ruin your credit score. Rather than waiting to perform a credit check when you are applying for a new loan, stay on top of your medical bills and ensure that they do not go to collections. If you are unable to avoid the circumstances, have your credit report pulled and determine which bills when to collection and the best way to handle them in order to avoid too much damage from occurring to your credit score.

Kedy Si is an active blogger who is fond of writing articles on Finance and educating people to check their credit data on regular basis to minimize the risk of fraud. Follow her on Twitter to know more on is medical debt damaging to my credit report.

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Created on Dec 31st 1969 18:00. Viewed 0 times.

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