Can Unpaid Medical Bills Damage Your Credit Score?
You or someone in your family has had a serious health event that required extensive medical care. You’re overwhelmed. Then as the medical bills start rolling in, you feel stressed all over again.
How will you pay for all of this? Maybe you decide to put off paying the medical bills. Besides, it won’t hurt your credit score, right?
Some people mistakenly believe that unpaid medical bills won’t hurt their credit score. The truth is, unpaid medical debt impacts credit scores for millions of Americans each year. When your FICO (credit) score takes a hit, so does your entire household budget – your mortgage interest rate, a car loan, your credit cards — everything.
A single bill can drop your FICO score by as much as 100-200 points. It doesn’t even have to be a large bill. It could be something as small as a $15 copayment that was sent to a collections agency.
What Should You Do?
Make sure your unpaid medical bill doesn’t have any errors. Sadly, 50-80% of all medical bills have errors. You should never pay $1 more than you owe for medical expenses.
Check your credit score at least twice a year. You should never pay for your credit score. There are several good websites that will let you see your score for free.
Once you have your credit report, review it to make sure there are no mistakes.
If you feel that unpaid charges are wrong, send a letter to the credit agency and dispute it. If they’re right, and you really do owe, resolve the situation with your provider or insurance plan. Remember, unpaid medical debt can impact your credit score. Don’t let it.
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