Does Medical Debt Go Away After Seven Years?
Some people think that debt just disappears after a set amount of time, but this is not always the case. For example, many believe that medical debt vanishes after seven years. While medical debt may be easier to manage than other types of debt, it will not necessarily go away entirely after seven years and could still negatively impact your credit report.
The 7-year figure does come from somewhere
However, under the Fair Credit Reporting Act, most negative information must be removed from your credit report after seven years. This includes bankruptcies, foreclosures, and late payments. So, if you have unpaid medical bills that are more than seven years old, they will no longer appear on your credit report.
While this may seem like good news, it’s important to understand that unpaid medical debt can still have a major impact on your finances. This is because medical debt is often sold to collection agencies. So, even if the original debt is more than seven years old, the collection agency may still report it to the credit bureaus.
This means that the debt could still show up on your credit report and impact your credit score. Additionally, collection agencies can continue to try to collect on the debt, even if it’s more than seven years old. So, while medical debt may not have the same negative impact on your credit report as other types of debt.
Statutes of limitations on debt collection by state
It’s important to note that each state has its own laws regarding the statute of limitations on debt collection. This is the amount of time a creditor or collection agency has to sue you for an unpaid debt. Once the statute of limitations expires, the creditor or collection agency can no longer sue you for the debt.
However, this does not mean that the debt is no longer owed. It just means that the creditor or collection agency can no longer take legal action to collect the debt. So, even if the statute of limitations has expired, you may still be responsible for paying back the debt.
Dealing with medical debt
If you’re dealing with medical debt, there are a few things you can do to make it more manageable.
First, you should try to negotiate with the medical provider. Many providers are willing to work out a payment plan or even reduce the amount of the bill.
You can also contact the collection agency and try to negotiate a payment plan. Keep in mind that collection agencies may be more willing to negotiate if you offer to pay a lump sum or make regular payments over time.
Finally, you can consider using a medical debt consolidation loan to pay off the debt. This can help you get a lower interest rate and monthly payment.
The bottom line is that medical debt will not automatically go away after seven years. However, there are ways to manage medical debt so that it doesn’t have a major impact on your finances.