Court records or announcements from major financial institutions

CFPB Rule Removes $49 Billion in Medical Debt for 15 Million Americans, Says Kamala Harris

Jan 7, 2025, 11:30 AM

The Consumer Financial Protection Bureau (CFPB) has finalized a rule that will remove an estimated $49 billion in medical bills from the credit reports of about 15 million Americans. The rule bans the inclusion of medical debt on credit reports used by lenders and prohibits lenders from using medical information, including information about medical devices such as prosthetic limbs, in their lending decisions. This action is expected to increase privacy protections and prevent debt collectors from using the credit reporting system to coerce payments. Vice President Kamala Harris stated that the rule would be 'lifechanging' for millions of families, emphasizing that no one should be denied economic opportunity due to medical emergencies. The CFPB's research indicates that medical debt is a poor predictor of a borrower's ability to repay other debts, and the rule could lead to the approval of approximately 22,000 additional mortgages annually, with potential credit score increases of about 20 points for affected consumers.