How Credit Repair Businesses Can Leverage the New CFPB Rule on Medical Debt

Short Answer: The CFPB’s new rule removing medical debt from credit reports opens up a huge opportunity for credit repair businesses to help clients improve their credit scores more quickly, and in doing so, drive business growth. Understanding how to leverage this rule for medical billing collections and debt elimination can turbocharge your credit repair operations.

In 2023, the Consumer Financial Protection Bureau (CFPB) announced a new regulation designed to address medical debt reporting. For years, medical collections have been one of the biggest factors dragging down credit scores, even when consumers have limited control over these debts. 

The new rule now removes medical debt collections from credit reports once paid, and it eliminates most medical debt collections under $500 from appearing on reports altogether. This change not only provides much-needed relief to consumers, but it also presents an unprecedented opportunity for credit repair businesses to drive growth and help clients improve their credit scores faster.

If you’re in the business of credit repair, this is the time to tap into the change. This blog will break down the CFPB rule, explain its implications for credit repair businesses, and provide actionable strategies you can implement to leverage the rule and build your business.

What is the New CFPB Rule and How Does It Affect Credit Repair?

In 2023, the CFPB announced new regulations aimed at reducing the burden of medical debt on consumers’ credit reports. The rule includes the following key points:

• Medical collections under $500 will no longer be reported on credit reports.
• Paid medical collections will be removed from credit reports, even if the debt was originally reported.
• Medical debts that are under $500 and were previously reported, will no longer appear on credit reports starting July 1, 2023.

This rule helps millions of people who have medical debt, especially those who struggled to pay for services due to unforeseen circumstances, by eliminating these debts from their credit reports, effectively boosting their credit scores.

For credit repair businesses, this represents a game-changing opportunity to accelerate credit restoration for clients who have struggled with medical debt. As medical billing collections no longer weigh down a person’s credit report, your clients’ credit profiles could see a significant improvement, creating faster results and better client satisfaction.

Did you know? According to the CFPB, about 68% of Americans have medical debt on their credit reports. Now, with this new rule, credit repair businesses can help clients see significant score improvements by addressing medical debt collections.

Why the New Rule is a Game-Changer for Credit Repair Businesses

Here are the top three reasons this new rule is a big plus for credit repair businesses.

1. Increased Demand for Services

With medical debt being a common issue for many Americans, the ability to quickly and effectively improve a client’s credit score is a huge draw for potential clients. The CFPB rule directly impacts people who have medical collections on their credit report. As businesses now help people remove medical debt from their records, the demand for credit repair services is expected to rise substantially.

2. Faster Results for Clients

One of the biggest challenges in the credit repair industry is the time it takes to improve credit scores. Traditional methods of credit repair often involve dealing with late payments, high credit card utilization, or complex debt disputes. Medical debt was one of the major slow-moving issues that affected many clients, often requiring a lengthy process to resolve.

With the new rule, paid medical collections are removed from the credit report, instantly increasing credit scores, which leads to quicker and more visible results for your clients. This not only helps you build your reputation as a credit repair business but also improves client retention as your clients start seeing positive changes more rapidly.

3. New Opportunities for Business Growth

By including medical debt removal services in your credit repair offering, your business can stand out from the competition. More and more consumers are searching for ways to repair their credit and eliminate their medical collections from credit reports.

This is the perfect time for credit repair businesses to create new packages or offers around medical debt removal and business funding for credit repair clients, expanding their service offerings and attracting more customers. You can also integrate this into your marketing by emphasizing the CFPB rule and how it helps consumers.

Key Strategies to Leverage the New CFPB Rule for Your Credit Repair Business

To capitalize on the new CFPB rule and effectively integrate medical debt removal into your credit repair offerings, below are five key strategies you must leverage on.

1. Update Your Service Offerings

Add medical debt removal to your credit repair service portfolio. With the new rule in place, many of your clients may now have medical collections removed from their credit reports after they pay off the debt. By offering medical debt cleanup services, you can help your clients see faster results and increase your revenue at the same time.

Here’s how to update your services:

• Create specialized packages: For clients struggling with medical debt, offer a streamlined package that focuses on getting medical debt removed quickly.
• Educate your clients: Let clients know that the new rule is a huge opportunity for improving their credit score, and show them how your services can help.

Sign up for Credit Veto Pro today and access specialized training on integrating medical debt services into your business.

2. Leverage New Tools and Technology

To maximize the potential of this new rule, you’ll need to upgrade your credit repair CRM and automation tools. The CFPB rule creates an opportunity for faster disputes, and client interactions should be seamless and efficient. Consider using a credit repair CRM that automates dispute letters, tracks progress, and organizes client data to optimize workflows.

Credit Veto Pro provides a comprehensive dual-service platform that integrates both credit repair and business funding, helping you manage your clients more effectively and ensuring compliance with the latest FCRA laws.

3. Educate Your Clients About the New CFPB Rule

The CFPB rule might be new to many people, so educating your clients is key. When you explain how the removal of medical debt can positively impact their credit, clients are more likely to trust your services. Use this opportunity to market your expertise and provide information through:

• Blog posts and social media updates
• Email newsletters with the latest news on credit repair and medical debt relief
• Webinars and workshops on how the new rules can improve credit scores

4. Track Key Metrics and ROI

Medical debt collections were often a significant factor in credit score repairs. By adding this service to your offering, you’ll want to monitor the results closely. Track KPIs such as

• Average revenue per client
• Dispute success rate
• Average credit score improvement
• Client retention rate
• New leads generated through marketing campaigns

By monitoring these metrics, you can ensure that you’re maximizing the impact of the new rule while optimizing your business operations for growth.

How Credit Veto Pro Can Help You Capitalize on the New Rule

Credit Veto provides a complete business solution to help you expand your credit repair services, including medical debt removal and business funding for clients. Here’s how we can help:

1. Medical Debt Dispute Automation: Automate the dispute process for medical debt with our advanced credit repair CRM.
2. Client Portal & Tracking: Give your clients a user-friendly portal where they can track their credit repair progress and communicate with your team.
3. Compliance-First Platform: Stay compliant with CFPB and FCRA regulations through automated documentation and audit trails.

Book a call with Credit Veto Pro and start using our platform to optimize your credit repair services and build a thriving business.

Conclusion

The CFPB rule removing medical debt collections is a huge win for both consumers and credit repair businesses. By adding medical debt relief services to your portfolio, you not only improve your clients’ credit scores faster but also open the door to more business opportunities. Take advantage of this new regulation and turbocharge your credit repair business.

Start leveraging this change now to offer dual services (credit repair and business funding) and provide your clients with the comprehensive financial solutions they need. With the right tools, automation, and compliance, your business can achieve rapid growth in this new landscape.

Ready to leverage the CFPB rule and scale your business? Start with Credit Veto Pro today and watch your credit repair business grow!

FAQs

Q: What is the new CFPB rule regarding medical debt?

A: The CFPB rule removes medical debt collections under $500 from credit reports and ensures paid medical collections are removed. This regulation aims to make it easier for people with medical debt to improve their credit scores.

Q: How does the CFPB rule benefit credit repair businesses?

A: It provides credit repair businesses with a new opportunity to help clients quickly remove medical debt from their credit reports, accelerating the credit repair process and increasing client satisfaction.

Q: Can I add medical debt removal to my credit repair business?

A: Yes! You can add medical debt removal to your service offerings by integrating the new CFPB rule into your workflow, helping clients improve their credit scores faster.

Q: Does Credit Veto provide tools to help with medical debt removal?

A: Yes. Credit Veto Pro offers advanced tools for automating the credit repair process, including medical debt disputes, and helps you stay compliant with CFPB and FCRA regulations.

Q: What metrics should I track to measure the success of this new service?

A: Track revenue per client, credit score improvements, dispute success rates, and client retention to measure how effectively you’re utilizing the new CFPB rule for growth.