In the News
Nothing has been in the news in recent years more than that which provides Americans with health coverage. All the way from Obama’s national health care plan down to medical creditors chasing senior citizens debtors to financially collect on their medical bills.
Just released by the Associated Press comes this news article written by Carla K. Johnson titled Medical bills can wreck credit, even when paid off. The article deals with how credit scores of debtors are affected when late payments, misunderstandings, and even errors, caused by no fault of the debtors, have been made through the collection efforts of quick draw medical providers.
The writer gave four personal illustrations in the article where the credit scores of the debtors plummeted after paying off their loans. A couple of these debtors, wanting to buy a home, had to pay extra discount points because of the credit plunge.
The article also address how Congress is currently trying to pass laws to overcome the apparent unfair credit practices. It was pointed out in the article by the American Collection Agencies International that many bill collection agencies around the United States support the current bill Congress is posing to solve the discrepancies. Once reported to credit bureaus, the discrepancy can remain on your credit report for up to 7 years, even if you have already paid the bills, and they are very hard to remove.
Jumping Gun on Credit Problem Not Unique
The problem with the medical industry jumping the gun on their reporting is not unique just to the medical industry. This blogger personally experienced a similar situation several years ago, although not with a medical provider.
A problem with a junk debt buyer eventually arose after an unsubstantiated debt from the use of a former oil company credit card. After moving across the country, I found out about the allegations of owing a bill when I tried to use my credit card when filling up with gas-o-lene. I called the oil company to validate the debt in question, but when the oil company could not, I assumed the matter to be finished. The oil company turned the debt over to a junk debt buyer, and some two years later, I started receiving phone calls.
I hired a lawyer to address the wrongful collection calls and did not realize at the time my credit scores had taken a hit. The calls ceased, but during the same time frame, my wife and I had an ARM coming due on our mortgage, and we elected to refinance to lower our interest rate. As a result, I either had to pay discount points or a higher rate. We opted for the fixed higher interest rate that will eventually cost us thousands and thousands of dollars in higher interest rates, all because an oil company made a mistake.
The lawyer forced the junk debt buyer and the reporting agencies to correct my credit report, years after it had already done its damage. No fault of ours and proved to be the fault of the oil company, the damage has already been done, and we are still suffering for it today.
Further laws to protect innocent consumers from falling prey to quick draw collection agencies, like medical providers, need to be passed.
- Debt Collection Company Gets Slap on Wrist (betterbankruptcy.com)
- Collections, Charged Off Debt, and Bankruptcy (betterbankruptcy.com)
- Debt Settlement, Collection Agencies, and Your P&L Before Bankruptcy (betterbankruptcy.com)
- Levy on Banking Institution Accounts (betterbankruptcy.com)
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