What the 2022–2023 changes actually did
The three bureaus (Experian, Equifax, TransUnion) made two big changes:
- July 2022: Paid medical collections were removed from all credit reports. Unpaid medical collections got a 12-month grace period before reporting (up from 6 months), so recent bills don't crash your score.
- April 2023: All medical collections under $500 were removed entirely — paid or unpaid.
The practical effect: if the only 'blemish' on your report is medical, you're likely in much better shape than you think. Pull your mortgage tri-merge report before assuming a decline.
How each loan program treats medical collections
FHA: Medical collections are entirely excluded from the DTI calculation. Unpaid non-medical collections over $2,000 in aggregate require a payment plan or 5% of the balance counted as a monthly debt.
VA: Medical collections are treated with judgment. Underwriters don't automatically penalize.
USDA: Similar to FHA — medical excluded from DTI. Recent (<12 months) unpaid non-medical collections may block approval.
Conventional (Fannie/Freddie): Medical collections don't count toward DTI. Non-medical collections must be considered but don't automatically decline.
What to do about a medical collection on your report
1. Verify it should still be there. If it's paid, under $500, or the underlying service happened more than 7 years ago — dispute it.
2. Ask for a pay-for-delete letter in writing before paying an old collection. Many medical collectors will delete for full payment, but only if you get it in writing first.
3. Ignore Credit Karma alerts on medical items. They use FICO 8; mortgage uses older models. The scoring effect is often smaller than the alert suggests.
4. Never open a new payment plan with the collector without your loan officer's OK — a new tradeline can look worse than an aged collection.
Is this path right for you?
Frequently asked questions
Will medical collections stop me from getting approved?
Almost never in 2026. Paid and small-dollar medical collections are gone from scoring, and FHA/VA/USDA/conventional all exclude medical from DTI.
Should I pay off my medical collections before applying?
Only if it clears an actionable dispute for deletion. Paying without a pay-for-delete letter often does nothing for your score.
Do I need to disclose medical debt on my mortgage application?
No. The credit report tells the underwriter what they need. You do not have to volunteer medical debt not on the report.
Related guides
- The Complete First-Time Homebuyer's Readiness Guide
- How much home you can actually afford
- Pre-approval checklist
- Back to the Knowledge Base
Run your numbers
Take what you just learned and apply it to your file.