A federal judge last week overturned a Biden-era Consumer Financial Protection Bureau (CFPB) regulation that would have eliminated unpaid medical debt from Americans’ credit records.
Following the arguments of two industry associations that had filed a lawsuit against the rule, which the Trump administration later joined, Judge Sean Jordan of the US District Court of Texas’ Eastern District concluded that the rule went beyond the bureau’s authority under the Fair Credit Reporting Act.
The court determined that the CFPB’s power was exceeded by “every major substantive provision of the Medical Debt Rule.” Jordan, who was appointed by President Donald Trump, wrote in his opinion.
The agency adopted the regulation just before the Biden administration left office in January, and it would have cleared the credit records of almost 15 million people for an estimated $49 billion in medical expenditures. Additionally, it would have prohibited lenders from making loan choices based on specific medical information.
Furthermore, if patients were unable to repay the loans, the law would have prevented lenders from taking back medical items, such wheelchairs or prosthetic limbs, that were used as collateral. Lenders might have, however, taken medical information into account in some circumstances, such as when a customer applies for a loan to cover medical expenses or seeks a short-term loan payment delay due to medical reasons.
Also Read:
Iran Will be a very different Country When its Supreme Leader Comes Out of Hiding
