Medical debt can affect your credit score, which is a key part of car buying. Your credit score can determine many aspects of car buying, including how much you qualify for and the type of lender you can work with.

Medical Bills vs. Medical Debt

Will Medical Bills Impact My Car Buying Ability?By the time medical bills show up on your credit reports your account is already in collections. Accounts that are in collections can do lasting and impactful damage to your credit score. Medical providers typically report you to a collection agency once your payments are 60, 90, or 120 days past due. The timing varies by provider.

Medical bills that you're actively paying on, which remain current, have no impact on your credit reports or score because medical providers don't report to the credit bureaus. However, once you begin to miss payments, the bill has a chance of ending up with a collection agency, becoming medical debt that’s reported.

The three major credit bureaus – Experian, TransUnion, and Equifax – have an additional layer of protection against medical debt harming your credit score. They each provide a 180 day waiting period before a medical debt shows up on your credit reports, giving you additional time to make payment arrangements or pay the bill.

Debts that show up in collections on your credit reports remain there for seven years.

What Does This Mean for Car Buying?

Your credit score and reports can impact your car buying experience in many ways. Firstly, when it comes to auto loans, there are many different avenues to take, but many of them depend on your credit.

Borrowers with a credit score of around 670 and lower likely need to work with different lenders than those who have a higher credit score. Traditional (or direct) lenders like banks, credit unions, and some online lenders generally only work with borrowers who have good credit.

If you have a poor credit score, you likely need to work with a special financing dealership that's equipped to handle tough credit situations. Having medical debt reported on your credit can be a sign of habitual bad credit, and can be a red flag to many lenders.

Habitual bad credit is signaled by things like missing or late payments on your credit reports or having other large negative marks on your credit reports, such as bankruptcy or past repossession. These signs differ from that of situational bad credit, such as job loss or unexpected medical expenses, and lenders can tell the difference.

Cleaning Up Your Credit to Get a Car

If you have habitual bad credit or medical debt that's impacting your ability to get an auto loan, you still have options. Perhaps your best chance at beginning to repair your credit is to start paying all your bills, medical or otherwise, on time.

Payment history is the biggest factor in making up your FICO credit score, 35% of it. It's also a good idea to get a copy of your credit reports and score so that you can see what lenders are seeing. You can get a free copy of your credit reports until April 20, 2022, from all three credit bureaus by visiting

If you find that there are mistakes or accounts you don't recognize you have the right to dispute errors with the credit bureaus. In most cases, you can do this online. If you find that your credit reports are in need of more fixing than you have time to tackle, you can also try to repair your credit reports through a third-party credit repair company.

Find the Right Lender to Help

Credit repair can take time, and sometimes you can't wait to get another vehicle. If you're dealing with bad credit due to medical bills or anything else, don't despair. There are lenders available to work with you through special finance dealerships, and we know how to help you find them.

At Auto Credit Express we've built a nationwide network of dealerships that are signed up with supreme lenders ready to help borrowers with less than perfect credit. To get started hassle-free, just fill out our fast, free, auto loan request form, and we'll get right to work locating a dealer in your area.