Comprehensive Credit Act of 2021

Comprehensive Credit Act of 2021 Summary​

The Comprehensive Credit Act of 2021 was a legislative proposal aimed at reforming consumer credit reporting practices in the United States. The bill sought to improve credit reporting accuracy, expand consumer protections, and provide greater transparency in credit scores and reports.

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Key Provisions:

1. Reduction of Negative Impact Duration:

   • Shortened the time negative credit information (e.g., late payments, collections) remains on a credit report from 7 years to 4 years.

   • Bankruptcies would be removed after 7 years instead of the standard 10 years.

2. Medical Debt Protections:

   • Required credit reporting agencies to remove paid or settled medical debt immediately.

   • Established a 1-year waiting period before medical debt could appear on a credit report.

3. Free Credit Score Access:

   • Mandated that consumers receive free access to their credit scores from nationwide credit bureaus.

   • Ensured that consumers get the same scores lenders use in decision-making.

4. Stronger Dispute & Error Correction Processes:

   • Improved the process for disputing inaccurate credit report information.

   • Required credit reporting agencies to respond within 30 days and provide stronger enforcement against inaccuracies.

5. Limitations on Employer Credit Checks:

   • Restricted employers from using credit reports for hiring decisions unless required by law.

6. Student Loan Protections:

   • Allowed borrowers to remove defaulted student loans from their credit reports after making consecutive on-time payments

 

Purpose and Impact:

The bill aimed to help consumers build and maintain better credit by reducing punitive reporting practices, particularly for medical debt and student loans. It sought to enhance financial opportunities for individuals facing economic hardship and prevent credit report errors from unfairly affecting creditworthiness.

 

While the bill gained support among consumer advocacy groups, it faced opposition from credit industry stakeholders and did not pass into law in its original form.