FICO No Longer Reports Paid Collections; Medical Bills

We frequently have borrowers, with otherwise perfect credit, come to us completely unaware that they have an unpaid medical collection. These borrowers are almost always under the impression that their insurance had covered their medical bills; they only find out about the bills when we pull their credit.

What made matters worse is the fact that these collections used to severely impact a borrower’s credit score.

The good news is that Fair Isaac Corp just announced that its FICO scores will no longer include paid collections in their score calculations, and they will give much less weight to unpaid medical collections.

This is a necessary change b/c too many responsible borrowers were being unfairly punished for unpaid bills they had no idea they owed.

Jay Voorhees
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 01524255, NMLS# 335646