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138279739Many Americans know that a good credit score (usually 715 and above) can open the door to many opportunities including financing a house, a larger portion revolving credit and lower interest rates. But Americans also know that unpaid large medical debts can hinder your credit score. Well, until now.

Pretty soon, those that have a mountain of outstanding medical bills will find themselves with a higher credit score. This is all due to a new scoring model that is set to debut this fall. Introduced by FICO, the top credit score provider in the US, it will put less emphasis on medical debt in collections, thus reducing its effect on consumers’ credit scores. In the new calculation method, the median FICO score for people who only have outstanding medical bills on their report will go up by about 25 points.

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John Ulzheimer, an expert at said, “This underscores that medical obligations are very different than any other kind of obligations because consumers don’t choose to incur hospital debt – it’s a very different type of risk posed by a consumer when they default on that type of debt”.

The new credit score calculation means that consumers who have large outstanding medical bills that they can’t pay will appear to be less risky to lenders. This, in turn, will allow them to qualify for better rates and deals.

Your Credit Score May Go Up (Thanks To Medical Bills)  was originally published on

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