It had been reported by the Commonwealth-Fund that numerous American citizens are facing immense troubles when they are look out for a refinancing or a loan.
The Park couple from Texas, Mark and Laura, had an idea that their credit scores were spotless and thus, they were looking for a better house; they simply wished to take benefit from the less market interest rates and so spoke to a lender about all these against their home as mortgage.
But all of a sudden they were shocked to see that their credit report contained a medical-bill of two-hundred dollars, which was forwarded to a collection agency. This ended up in lowering their credit scores by about a hundred points which made them to pay about $2500.
The aforementioned report also revealed that in the year 2005, around 20 million people from America itself was contacted by these collection firms with charges of unpaid medical-bills; this estimation increased by another five million by the next five years.
It was quite a lot surprising to find out that the credit scores weren’t updated till about seven years after the payment of the bill. This issue resulted in the fact that the people had to pay more for financing a home and didn’t receive the expected interest rates. It has been estimated that numerous (about a 3.4 million) people have cleared their lingering medical loans to clear out their credit reports.
It had been extracted that numerous causes lead to forwarding the bills to the collection agencies and the process needs to be revised to stop this harassment. The legislature has passed an act force the firms to update the credit-report within one-and-half months, to ensure that the citizens are not troubled.