Big news for credit scores!
After the Equifax security breach late last year, many people started paying a lot closer attention to their credit scores and the agencies that report on them.
We are happy to let you know that some big changes are on the way that will not only make qualifying for a home easier, but lighten the burden for a lot of different financing situations. The following changes are likely to help improve credit scores for many people and will be implemented beginning June 8, 2018.
- Collections under 180 days will no longer be accepted, giving consumers time to pay a collection before it hurts their credit
- Medical collections that are paid (or are being paid through insurance) will no longer negatively impact credit
- Collections with no activity for more than 6 months will be dropped from your credit score as the creditor is presumed to no longer pursue the collection
- Collections without a contract or agreement (i.e. traffic tickets and library fines) will also be removed
This could have a significant impact on a consumer’s credit scores as a collection account, even for the most minor thing, can affect a credit score by 100 points or more. Not having these collections factored in will open the doors for a lot of consumers that could not qualify before or may improve the loan and rate options for those with less than perfect credit.
If you have struggled with your credit in the past, or are just curious to see what these new regulations could mean for your purchasing power, give us a call today!
If you would like to check your current credit score, you can do so with no obligation or impact to your score at: www.annualcreditreport.com.