What we verified in “Medical debt: your credit and your mortgage application”

Statements and where we checked them

The statements with rules, figures or dates, with the exact place in the source and the date we checked them.

1. According to the CFPB, on July 11, 2025 the U.S. District Court for the Eastern District of Texas vacated the CFPB rule that barred credit bureaus from including most medical debt (Regulation V), at the joint request of the CFPB and the plaintiffs; the court agreed the rule exceeded the CFPB's authority and was contrary to the Fair Credit Reporting Act, which permits furnishing coded medical debt information as long as it does not identify the provider or the nature of the medical services.

   Sources 1 · Prohibition on Creditors and Consumer Reporting Agencies Concerning Medical Information (Regulation V): 'On July 11, 2025, the U.S. District Court of the Eastern District of Texas vacated the Consumer Financial Protection Bureau’s rule'; 'upon the joint request of the Bureau and the plaintiffs in Cornerstone Credit Union League v. CFPB'; 'the rule exceeded the Bureau’s statutory authority and was contrary to the Fair Credit Reporting Act'; 'FCRA permits those activities so long as the medical debt information does not identify or provide information sufficient to infer the specific provider or the nature of medical services' · Checked October 31, 2026

2. According to the CFPB (archived page, last modified June 25, 2026), the three nationwide credit bureaus (Equifax, Experian and TransUnion) removed paid medical debts and those less than a year old from reports, and took steps to remove medical collections under $500, effective April 11, 2023; this does not include credit card collections, even if you used the card for a medical expense; the bureaus wait one year from when you saw a doctor before letting medical debt appear on your report; you can check your reports for free every week at AnnualCreditReport.com and dispute what should not be there; and you can submit a complaint to the CFPB if it is not resolved.

   Sources 2 · Have medical debt? Anything already paid or under $500 should no longer be on your credit report (archived; page last modified Jun. 25, 2026): 'removed all paid medical debts from consumer credit reports and those less than a year old'; 'remove all medical collections under $500. This last step went into effect on April 11, 2023'; 'this doesn’t include credit card collections, even if you used your credit card to pay for a medical expense under $500'; 'now waiting one year from the time you saw a doctor'; 'free online credit reports once a week through AnnualCreditReport.com'; 'you can dispute that information'; 'submit a complaint to the CFPB' · Checked October 31, 2026

3. According to the CFPB, it told debt collectors and credit bureaus that they cannot collect, furnish or report invalid medical debt.

   Sources 2 · Have medical debt?...: 'the CFPB told debt collectors and consumer credit reporting companies that they can’t collect, furnish, or report any invalid medical debt' · Checked October 31, 2026

4. According to HUD Handbook 4000.1, on FHA loans underwritten with the TOTAL system, medical collections are on the list of obligations not considered debt; and for other collection accounts totaling $2,000 or more, the lender must verify they are paid, that you have a payment arrangement included in your debt-to-income ratio, or calculate a payment of 5% of the balance.

   Sources 3 · Handbook 4000.1 (last revised August 12, 2026), II.A.4, '(M) Collection Accounts (TOTAL)', p. 219–220: 'cumulative outstanding collection account balances of $2,000 or greater'; 'verify that the debt is paid in full'; 'payment arrangements with the creditor'; 'using 5 percent of the outstanding balance'; '(Q) Obligations Not Considered Debt (TOTAL)', p. 222: 'Obligations not considered debt include: medical collections' · Checked October 31, 2026

5. According to Fannie Mae's Selling Guide (B3-5.3-09), medical collection accounts are excluded from the collection limits and are not required to be paid in full at or before closing; and for a one-unit principal residence, borrowers do not have to pay off collections or non-mortgage charge-offs, regardless of the amount.

   Sources 4 · Selling Guide B3-5.3-09, DU Credit Report Analysis (08/05/2026), 'Past-Due, Collection, and Charge-Off of Non-Mortgage Accounts': 'Medical collection accounts are excluded from the limits below and are not required to be paid in full at or prior to closing'; 'For one-unit, principal residence properties, borrowers are not required to pay off outstanding collections or non-mortgage charge-offs—regardless of the amount' · Checked October 31, 2026

6. According to the IRS, to keep their tax exemption nonprofit hospitals must have a written financial assistance policy stating who qualifies and whether help includes free or discounted care; they must widely publicize it, including on their website; and an eligible person may not be charged more than the amounts the hospital generally bills for emergency or medically necessary care.

   Sources 5 · Financial assistance policy and emergency medical care policy – section 501(r)(4): 'hospital organizations must meet the requirements imposed by Section 501(r) ... in order to be treated as an organization described in Section 501(c)(3)'; 'Eligibility criteria for financial assistance, and whether such assistance includes free or discounted care'; 'The written FAP must be widely publicized'; 'Post complete, current versions of the FAP documents on a Website'; 'a FAP-eligible individual may not be charged more than Amounts Generally Billed (AGB) for emergency or medically necessary care' · Checked October 31, 2026

7. According to the IRS, a nonprofit hospital must make reasonable efforts to find out whether you qualify for financial assistance before taking extraordinary collection actions, which include reporting negative information to credit bureaus; the hospital is also accountable for collectors or buyers of the debt; it must notify you of its policy and not start those actions for at least 120 days from the first bill after your care; you have a 240-day period from that bill to apply; the hospital must notify you at least 30 days before starting those actions; and it may accept applications at any time.

   Sources 6 · Billing and collections – section 501(r)(6): 'make reasonable efforts to determine whether an individual is eligible for assistance ... before engaging in extraordinary collection actions (ECAs)'; 'reporting adverse information about an individual to consumer credit reporting agencies or credit bureaus'; 'A hospital facility is held accountable for the ECAs of third parties'; '120-day “notification period” and a 240-day “application period,” both beginning on the date the first “post-discharge” billing statement is provided'; 'must notify an individual at least 30-day before initiating one or more ECAs'; 'may continue to accept and process FAP applications from patients at any time' · Checked October 31, 2026

8. According to CMS, the No Surprises Act took effect January 1, 2022, applies to most health coverage and protects you from surprise out-of-network bills for emergency room visits, non-emergency care related to a visit to an in-network hospital or facility, and air ambulance; if you do not have or use insurance, providers generally must give you a good faith estimate if you ask or schedule at least 3 business days ahead, and you may dispute the bill if it is at least $400 more than the estimate; you can file a complaint; and phone help is available in Spanish and other languages at 1-800-985-3059.

   Sources 7 · Medical bill rights (page last modified October 5, 2026): 'The No Surprises Act is a federal law that went into effect on January 1, 2022'; 'Emergency room visits'; 'Non-emergency care related to a visit to an in-network hospital'; 'Air ambulance services'; 'providers must give you a good faith estimate ... if you request one or schedule services at least 3 business days in advance'; 'You may be able to dispute your bill if it’s at least $400 more than the estimate'; 'You can submit a complaint'; 'Get help in Español ...: 1-800-985-3059' · Checked October 31, 2026