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Home>UPDATE: 200,000 people could see their credit scores rise because of this change

UPDATE: 200,000 people could see their credit scores rise because of this change

UPDATE: 200,000 people could see their credit scores rise because of this change

10/06/2017

By Maria LaMagna

Scores could rise about 20 points

The three major credit agencies, Equifax (EFX) , Experian (EXPN.LN) and TransUnion, (TRU) have made a change that could raise about 200,000 consumers' credit scores.

The agencies have started an initiative called the National Consumer Assistance Plan (http://www.nationalconsumerassistanceplan.com/about/) (NCAP), with a goal to make credit reports more accurate, and to make it easier for consumers to correct errors on their reports.

The latest result of that initiative: Starting Sept. 15, the agencies started to remove some medical collections from consumers' credit reports. They will remove medical bills that have fallen into collections that are less than 180 days old and those that have been classified as "paid by insurance."

They will also wait 180 days before reporting medical collections to allow time for insurance payments to be applied to the debt.

Some 75% of consumers who have these removed will see a score increase of less than 20 points, said Tommy Lee, a principal scientist at FICO. But some could see increases that are more. Twenty points is a small increase, but for consumers who could use the boost to put them into a higher tier of credit -- for example, "fair" to "good" credit categories -- the rise could help.

See also:How this woman raised her credit score from 490 to 800 (http://www.marketwatch.com/story/how-this-woman-raised-her-credit-score-from-490-to-800-2017-10-04)

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