Moving on…
In the above article, legislation was brought forth to replace our current system with a publicly run registry run under the Consumer Financial Protection Bureau, which guards consumers against unfair or abusive practices. A few proposed overhauls:
Stopping credit score use for non-credit purposes. With this proposal, employers would not be allowed to use credit scores to screen potential employees, and things like auto insurance would not be affected by your score.
Cutting the amount of time that negative details stay on your report. Collections and missed payments would get removed after 4 years instead of 7, although bankruptcies would not change.
Putting a leash on medical debt. Medical debt for medically necessary services would be prohibited, and unpaid medical bills would not be reported for one year to give people time to pay and resolve any issues with insurance or hospitals.
Implementing COVID-19 protections. Negative information during the pandemic would be prohibited temporarily (as well as other disasters). This can only be a good thing – there are many horror stories about people losing their jobs in the last year and unable to pay their bills. This will give people the opportunity to get back on their feet without tanking their financial future.
The article goes quite in-depth, so I highly recommend you check it out here.
Regardless of your thoughts on the government getting involved in what’s essentially our financial report cards, I think we can all agree that our current system is broken and needs a lot of work to make sure it gives everyone a fair shot to have a healthy financial life.
If you have any questions at all about what this all means and how it will affect you, book a quick 15-minute chat with me by calling 513-563-PLAN (7526) or by clicking here. It’s my job to be in the know about the world of personal finance, and I’d be thrilled to talk it over with you.
Regards,
Nikki Earley, CFP®
