Macco & Corey P.C.

FICO 9 credit score may help those with medical debt

FICO 9 credit score may help those with medical debt

It only takes one major illness or significant injury to send your finances into a tailspin. Bills come rolling in from physicians, anesthesiologists, hospitals, labs and therapists. Even those in Long Island with health insurance may find that there are many expenses that were not covered, leaving them in a financial bind.

Unfortunately, if these unpaid medical bills go unpaid and go to collections, it can have a negative effect on one’s credit score. In fact, according to one source, over 64 million people across the nation have some sort of medical debt showing up on their credit report.

However, those with medical debt may benefit from a new credit score: the FICO 9. FICO is the credit score that is most often used across the nation. In fact, 90 percent of all creditors, be they mortgagors, credit card companies or others, utilize FICO scores. With the FICO 9, medical collections will not be treated the same as non-medical collections; a medical collection will damage your credit score less than other types of collections. Moreover, under FICO 9, the older the collection item is, the less it will affect your credit score. In fact, if a debtor pays back the debt that had been sent to collections, their credit score will actually benefit.

It may take time, however, to realize these benefits, as much as 18 months in some cases, due to the process in which a bank decides how to upgrade one’s credit score. But, consumers should not despair. The FICO 9 score may still benefit them in the long run, and if they still find they are unable to satisfy their debts, they can always consider other debt relief options, including filing for bankruptcy.

Source:, “What you need to know about the new Fico 9 credit score,” Sept. 22, 2016