Overview

• U.S. District Judge Sean Jordan vacated the January medical debt rule on July 11 after finding the CFPB exceeded its authority under the Fair Credit Reporting Act.
• The bureau had estimated the rule would strip $49 billion in unpaid medical bills from credit files of roughly 15 million Americans.
• Industry groups including the Consumer Data Industry Association and Cornerstone Credit Union League filed suit and were later joined by the Trump administration.
• The CFPB has chosen not to appeal the ruling and major credit bureaus’ prior voluntary removal of paid and small medical debts remains intact.
• Consumer advocates warn that restoring medical debt to reports could raise borrowing costs and deepen financial inequality for lower-income households.