UW-Madison Division of Extension highlights credit report changes coming July 1
For the Tomahawk Leader
WISCONSIN – Educators from UW-Madison Division of Extension are reminding area residents that beginning Friday, July 1, there will be multiple changes in the way that information will appear on credit reports.
“Staying on top of what’s in your credit report can help you spot errors and possible instances of identity theft,” a release from Extension said. “Additionally, a positive credit history helps you access housing and financial products, and to get the best interest rate when applying for loans, insurance and more.”
Extension said many of the changes are “designed to benefit consumers, and others serve as good prompts to be aware of how you are making your purchases.”
Buy Now, Pay Later to appear on credit reports
Many online retailers have begun offering shoppers the option of paying for their purchases in installments rather than all at once at checkout.
“This option has proven attractive to some consumers because it comes without the finance charges that are levied by credit cards,” Extension stated. “Starting July 1, this buy now, pay later (BNPL) activity will begin showing up on credit reports and could impact your credit score because these BNPL accounts are considered short-term loans. Even if you pay off your BNPL on time, your score could go down because the average age of your overall credit history could decrease. Each time you take on a new credit obligation, that lowers the average age of your credit history.”
Most medical debt coming off credit reports
Three major changes that impact how medical debt appears on credit reports are coming soon.
“Beginning July 1, consumers will have one year to resolve billing or insurance issues before unpaid medical debts show up on their credit reports,” Extension said. “Currently, the period is six months.”
Also starting July 1, any medical debts that were sent to collections and later paid off will no longer appear on credit reports. Starting in 2023, the credit bureaus will not report medical debt under $500.00.
“These measures will lead to the removal of 70% of medical collection debt from consumers’ credit reports, providing some respite for the millions of people carrying more than $88 billion in medical debt,” Extension stated.
Free credit reports available weekly through Dec. 31
During the pandemic, the three major credit bureaus (Equifax, Experian, and TransUnion) switched from each providing a free copy of a consumer’s credit report once every year to once each week. This temporary measure was set to expire in April 2022 but has been extended through the end of the year, to Dec. 31, 2022.
Extension said the quickest way to access your credit report is via www.annualcreditreport.com.
“The secure site allows consumers to complete a short form and request a report from one, two, or all three of the credit bureaus,” Extension stated. “By choosing the online option, you can get your report right away.”
Other ways to get your report are by calling 1-877-322-8228 or by mailing a request to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, Ga., 30348-5281.
Extension noted that if requesting by mail, a request form found on the site must be printed, or one may be requested through the Oneida County Extension office.
To receive reminders to check your report three times per year, visit www.bit.ly/3QEqt4G.
Questions or requests for additional information may be directed to Terri Kolb, HDR Educator, at 715-365-2756 or [email protected].