The Consumer Financial Protection Bureau (CFPB) is ANOTHER “department” Trump has to dismantle. IT is UNCONSTITUTIONAL and is nothing but another place to dump DEMONRATS who lose other jobs. Its recent rule not to allow medical debt as part of score ratings is destructive to the TRUTH.
THE REPUBLIC of the USA cannot have an “independent” BUREAU that is not accountable to US!
END this monster and dismantle the DEPT of ED that will also killl the PERVERT TEACHERS UNIONS, get rid of THOUSANDS of federal “employees” by ending their “jobs” and get the federal government our of education - student loans back to banks, NO GRANTS, NO $$ for any educational anything. IT IS UNCONSTITUTIONAL on its face.
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January 20, 2025
Re: CFPB changes to Medical Debt credit reporting
To the attention of EVERYONE:
My name is Kenneth Loftis and I’ve been in the collection industry since 1991. I was a young man in my twenties then and my heroes were figures like John Lennon, who famously said “there are no problems, only solutions”.
I have been in the collection industry now for thirty plus years and in my mid-fifties I find myself now quoting Thomas Sowell instead who said, “there are no solutions, only tradeoffs”.
The changes that the CFPB has put forth will have ramifications that will be far and wide reaching, not only to healthcare professionals but also in the private sector.
The credit bureaus themselves started this by greatly overstepping their boundaries in 2022 and deciding to put a cap on the minimum amount of debt that can be reported. I do not recall any vote, discussion or consensus to reaching the decision that was put into place.
Most of us in the industry know that it’s the smaller balances that make up a large portion of our portfolios. By excluding those from being accepted, many private practices who counted on those $100.00, or $250.00 payments (and who were not being paid already) suffered a tremendous revenue loss from that decision. Some in fact, have already been forced to close their doors as a result.
I’ve seen it, you’ve seen it, we’ve all seen it.
Let’s put aside the “cause factor” of the debt momentarily and acknowledge that we are still talking about A DEBT. No one in our industry wishes ill intentions on those who suffered a medical situation which created the debt.
We are all in agreement that payment plans, settlement reductions, and hardship arrangements should always be offered to those who need time to resolve their debts.
But since the Affordable Care Act came to power, we all know that we have seen higher insurance costs, higher premiums, and higher out of pockets thrust upon us. That leaves everyone owing someone an “out of pocket”, and so what now?
The credit bureaus already encouraged the non-payment of those balances but not accepting them. People, most people, do not just pay their debts because they have a strong moral character. They do it because of the ramifications of what happens if they don’t pay.
By taking balances to a $400.00 minimum cap (and $500.00 here in glorious New Jersey (aka California East) is basically saying to everyone “if you don’t pay this nothing will happen” is no different, none at all than saying “if you steal under $900.00, we will not consider it a crime, and nothing will happen”.
You know what happened and how that worked out right?
Have you been to a store recently that had everything you wanted behind a locked glass door? Now imagine what happens when the doctors and private practices that the CFPB said shouldn’t have a right to get that money (which is an indirect result of what they are doing) must close.
You will have even longer waiting times, and even less quality of care than which was already increased by the Affordable Care Act guidelines.
The CFPB mission in saying that “medical debt” should not be a factor in determining credit scores so everyone can get a car, a mortgage, etc. is the DEI-ification applied to credit scoring. What debt will they deem ineligible next to make your credit score look better and what purpose is a credit score if it’s not an accurate representation of what and who you owe.
Why don’t we all just get a 950 score and call it a day then?
And since when did the credit bureaus get in the practice of boosting your credit scores? Their purpose was to provide a track record of a consumer’s history, who got paid, who got paid late, or who didn’t get paid. But now the credit bureaus are in business, (looking at you Experian Boost) to take things off your credit, bump up your score and make money as they enroll consumers in their programs.
This has all gotten so far away from what these programs were designed to do, report your credit history not to create a feel-good profile. Why not remove an auto repossession? Won’t that hinder a consumer getting another car loan, or that foreclosure, I mean that’s just not fair!!!
The young man in his twenties I mentioned earlier, yeah, he had bad credit. Real bad. He spent too much; he paid things late and carried too much debt.
And in a moment of enlightened epiphany (IE; I was getting denied for everything) and realizing the impact it was having on doing things, I worked hard to improve my credit, I spent less, I made better decisions, because I was impacted.
Novel idea, right?
For all the State legislators who support this change, the warm-hearted Creditors who say YES this is the right thing to do. If someone owed them money, how many would be willing to say, “it’s okay don’t worry about paying me back. I’ll eat that debt, and you go ahead and buy your house, go get your new car, and please take that beach vacation and I’ll take the hit”. I’m guessing the answer is ZERO.
I bet if you enrolled in any program and owed $100.00 for that program, they would want their money. Looking at you again Experian Boost. How about the State of New Jersey (aka California East), I’m sure they would be willing to pass up collecting that $100.00 ticket, right? Try it and see.
We must stop this CFPB law before it happens, and this needs action before it’s too late and becomes law. We need to bring the bureaus back to their origination of reporting debts, paid or unpaid and make sure they know it isn’t their role to decide what is or is not qualified to get people better scores.
This was all done before, and it FAILED miserably for those of us who remember the housing crisis and lived through it.
Thank you for your time.
Reformed debtor,
Kenneth Loftis
Director of Operations, Quality Asset Recovery
GET RID of FANNIE and FREDDIE and dismantle the FEDERAL RESERVE that has made Americans poorer. GET the feds out of our lives!