CFPB to Focus on Credit Reporting and Medical Debt Collection in 2015
For the first time this year, the Consumer Advisory Board (CAB) of the Consumer Financial Protection Bureau met last Thursday in Washington D.C. to discuss the organization’s focus for 2015. The meeting centered around credit reporting and the collection of medical debt, specifically how medical debt shows up on credit reports.
The CAB is comprised of representatives from consumer advocacy groups, collection agencies, legal experts and other members who provide a different perspective than the stakeholders in the CFPB.
CFPB Director Richard Cordray opened with a statement about the Bureau’s efforts in the credit reporting market, noting that Experian, Equifax and TransUnion each hold files for more than 200 million consumers. Cordray said the organization must focus on regulating how consumers can access their credit reports and monitoring the accuracy of those reports.
The CAB noted many consumers are confused about the difference between a credit report and a credit score. Even though most Americans are aware they can receive one free credit report per year for each reporting agency, they assume it comes with a score. That is not the case. The CFPB is working to expand its Open Credit Score initiative, which gives consumers free access to their credit scores through their credit card providers.
The CAB also expressed concerns on how quickly medical debt shows up on a person’s credit report, saying this debt shows up far faster than most other forms of debt. The CFPB ran a study in May of last year that showed payments for medical debts were not good indicators of future payment behaviors.
The CFPB will continue to focus on credit reporting and medical debt collection in the coming months in an effort to improve the financial circumstances of all Americans.