Mortgage applications with borderline FICO numbers are frequently avoided by lenders, often unfairly.
According to The Wall Street Journal, of the 106.5 million consumers with a collection on their report, 9.4 million had no balance. Those 9.4 million American won't be penalized under the new credit-score system.
Unpaid medical bills will now carry lower weight compared to non-medical debt going to collections. "The median FICO score for consumers whose only major derogatory references are unpaid medical debts is expected to increase by 25 points," according to FICO's release on the new model.