My Letter to Chairman Barney Frank

National Association of Home Builders Supports H.R. 3421!

Spark360 Helps Mortgage Lender Fill Prescription for Medical Debt Relief

Dallas, TX (PRWEB) June 7, 2010 — Spark360’s “Social Business Television” becomes “Social Advocacy Television” with the story of Rodney Anderson, a Dallas-based mortgage banker who has launched a one-man crusade to raise credit scores for potential homeowners by proposing legislation and working to push it through Congress.

spark360 covers Rodney Anderson as he pursues a personal crusade to reform the credit reporting industry.

Anderson, a mortgage banker with Supreme Lending, has spent money and man-hours to work the Washington D.C. maze of power brokers and find legislative support for HR 3421, the Medical Debt Relief Act of 2009. Anderson’s bill would correct a little-known stipulation in credit reporting: a medical debt collection can stay on a borrower’s records for seven years, even if the debt was paid in full or settled. The Medical Debt Relief Act would require that the paid or settled debt would disappear from a borrower’s credit report after 30 days.

“There’s an injustice happening to the American people, and we need change when it comes to medical debt on people’s credit reports,” Anderson told spark360 host/managing editor Renay San Miguel.

“There’s an injustice happening to the American people, and we need change when it comes to medical debt on people’s credit reports,” Anderson told spark360 host/managing editor Renay San Miguel. “In our studies, it’s affecting more than 40 percent of all Americans.”

Anderson – host of a weekend radio show on personal finance who has his first book, “Credit 911,” publishing in August – began his journey to Washington after hearing stories from borrowers who were denied home loans or refinancing because of a forgotten hospital bill. Jennifer Trimmer sought treatment for a heart condition several years ago; a debt related to that experience cost the single mother a refinancing option on a rental property.

“I make good money and I pay my bills on time, and I thought everything was going great and I wanted to take advantage, again, of the lower interest rate – and I can’t,” Trimmer told San Miguel.

“It’s very discouraging, obviously, to those people who have never missed a payment to anyone, and have a $20, $30 medical collection from five years ago that drops their scores, and I have to look at them and say, ‘I’m sorry, your credit score doesn’t meet the requirements to obtain a mortgage loan,’” said Suzie Reed, Supreme Lending’s Executive Director of Mortgage Operations. “I get everything from anger to desperation – ‘I’ll pay it, I didn’t even know it was there, if I just pay it can we have our house?’ It’s heartbreaking.”

Congresswoman Mary Jo Kilroy (D-Ohio) has introduced the Medical Debt Relief Act of 2009 and the bill currently has 101 co-sponsors. Senator Jeff Merkley (D-Oregon) has taken up the cause in his chamber. Anderson estimates that the Act would pump billions of dollars into the U.S. economy and immediately raise credit ratings for many Americans. But Anderson says he has not contributed any money to any member of Congress or to political action committees, and has turned down outside funding help from interested individuals and organizations.

“It’s a two or three-page bill. We want to keep it simple,” Anderson said. “We understand that this is a simple solution that millions of Americans need. So I didn’t want other people to have a different agenda.”

“With Rodney Anderson’s story, spark360 branches out into a different genre of storytelling – one that is still related to business but is also more issues-oriented and has the potential to impact a lot of homeowners and borrowers,” said San Miguel. “Anderson is taking a big gamble here to try and effect some positive change in Washington. You can’t ask for a better story than that.”

Senior Producer Steven Swaim added, “Working with impassioned business owners and entrepreneurs is something we enjoy on a daily basis. Getting the opportunity to highlight Rodney’s story has been an experience that we hope to repeat soon.”

Healthy idea: Separating medical debt from other debt - Pamela Yip, Dallas Morning News

Jun. 7–The effort to keep medical debt from haunting a consumer’s credit history is gaining momentum in Congress with the recent introduction of the Medical Debt Relief Act.

The bill, introduced in the Senate, would prohibit credit bureaus from using paid off or settled medical debt collections in assessing a consumer’s credit worthiness.

In addition, the bill would require the creditor or credit rating agency to expunge the medical debt from the consumer’s record within 45 days from the day it is paid off or settled.

A House version of the bill would require medical debt that has been paid off or settled to be removed from credit records within 30 days of resolution.

“We have momentum moving everyday,” said Plano mortgage banker Rodney Anderson, who has been sounding the alarm about how medical debt can wreck a credit record. “Everyday, we see clients whom this is affecting. Many are not able to get home loans. It’s not fair to these people.”

More adults are struggling to pay medical bills and are accumulating medical debt.

According to the Commonwealth Fund, an independent health care research group, the number of people reporting problems paying medical bills or having accumulated medical debts has been growing rapidly. Between 2005 and 2007, that number grew by 23 percent to 27 million adults, it reports. (More recent data are not available.)

“It’s a number that has been growing because the number of people without health insurance has been climbing and the number of people who are underinsured has also grown,” said Sara Collins, vice president of the Affordable Health Insurance Program at the Commonwealth Fund. “Both trends are driven by health care costs that are rising faster than income.”

She expects the number of people struggling to pay off medical debt to grow because of continued job losses.

The problem has Washington’s attention.

“It’s already incredibly difficult for families to pay off the high cost of medical treatments for serious injuries and diseases,” said Sen. Jeff Merkley, D-Ore., one of several senators who introduced the Senate bill. “To add insult to injury, after families pay off their exorbitant medical debt, they continue to take a hit on their credit scores. This bill will give families a fair deal and ensure that their future financial transactions won’t be negatively affected by a bad credit score just because of past medical debt.”

Experts say that even one negative medical collection mark can drop a consumer’s credit score, potentially costing that consumer thousands of dollars in higher interest rates on home and automobile loans, credit cards and other revolving lines of credit.

Because many medical bills are submitted first to insurance companies, consumers often don’t learn that they’re responsible for a medical bill until they hear from a collection agency, by which time their credit score has already suffered.

The three national credit bureaus — Experian, TransUnion and Equifax — make no distinction between unpaid medical bills and any other delinquent bill. In their models for determining a person’s credit score, medical debt is treated like all other consumer debt.

That’s unfair because medical debt is unlike other debt.

It’s often beyond the control of consumers. It’s not caused by poor money management and therefore doesn’t reflect a person’s creditworthiness.

You don’t ask for a heart attack or to get into a serious accident.

No expenditure can hurl you toward financial ruin as quickly as medical bills. If you’ve paid off or settled your medical debt, your credit record should promptly reflect that, and it shouldn’t be used to portray you in the same unfavorable light as if you were a wild spender.

Congress needs to pass the legislation.

Private citizens take troubles to lobbyists

WASHINGTON — In June 2008, Dallas-area
mortgage banker Rodney Anderson ran into an
obstacle: An older couple who were longtime clients
were having trouble getting a loan for what would
be their final big purchase, a retirement home. The
problem: a $150 medical bill that lowered their
credit score by 120 points because it had gone into
collection before it was paid.

Anderson had seen cases like this before, but now
he decided to act. He began tracking the numbers.
He collected consumers’ stories on his website. He
buttonholed anyone who would listen, arguing that
the federal law requiring paid medical collections to
remain on credit records for seven years is unfair to
consumers perplexed by the error-prone process of
medical billing.

Then, Anderson tried a tactic typically deployed
only by savvy political insiders: He hired a federal
lobbyist. Two years and $400,000 of his own
money later, a bill that would erase medical
collections from credit reports within 30 days of
payment has 101 sponsors in the House. A similar
bill that would remove the debt after 45 days
recently was introduced in the Senate by Sen. Jeff
Merkley, D-Ore.

CAPITOL HILL: Limits on lobbying have their limits

Anderson is among the dozens of private citizens
who hire lobbyists each year. They range from
victims of Bernard Madoff’s infamous Ponzi scheme
to William Weld, a former two-term governor of �
Massachusetts. Others want presidential pardons or
congressional help with immigration troubles.

In the first three months of this year, 16 individuals
hired lobbyists, according to data culled from
lobbying records for USA TODAY by the non-
partisan Center for Responsive Politics. Twenty-six
private citizens took similar action in the first three
months of 2009, pumping $795,000 into their
lobbying activity. That is minuscule compared with
the $851.9 million that big business, unions and
others paid lobbyists to influence the course of
public policy during the same period.

Although their budgets are dwarfed by those of
powerful interest groups, these individuals believe
“you need a lobbyist to be heard,” said Meredith
McGehee of the non-profit Campaign Legal Center.
“The bad news is that, to a certain degree, that’s
true.”

Private citizens with lobbyists include:

• Hedge-fund founder Julian Robertson, who has
spent nearly $1.6 million since 2007 on lobbying to
push climate-change legislation. Robertson
declined to be interviewed, but his spokesman
Fraser Seitel said Robertson thinks “it’s critically
important for the U.S. to adopt a cap-and-trade
system.”

• Maureen Ebel of West Chester, Pa., who lost more
than $5 million in Madoff’s multibillion-dollar
swindle. Ebel is represented on a pro-bono basis by
Helen Davis Chaitman, a commercial litigator from �
New York, who also saw her entire retirement
savings — she won’t say how much — vanish in the
scam. Chaitman said she has met with about 75
lawmakers and aides in the past nine months.

Ebel, 61, a widow, said she has struggled to
support herself since Madoff’s crime was discovered
in 2008. She sold her vacation condo in Florida and
found work tending to the elderly mother of a friend
and cleaning the woman’s house. Another job, as an
office manager, ended in December when she was
laid off. She is taking classes to restore her license
as a registered nurse, which lapsed in the tumult
surrounding the death of her physician husband in
2000. “I’m no spring chicken, and I’m starting over,”
Ebel said. “This is not how I imagined the end of my
life would be.”

In what Madoff victims count as an early victory, the
IRS eased its rules on theft losses to allow Ponzi
scheme victims to claim tax dedications on the
majority of their losses, enabling Ebel and others to
collect refunds.

•Weld, the Republican former governor, hired Lanny
Davis, special White House counsel to President
Clinton, to lobby on his behalf. Weld alleges that an
Education Department official unfairly triggered the
demise of a trade college run by Weld. He has spent
$50,000 on lobbying, records show.

Weld, a federal prosecutor in the 1980s, had led a
criminal investigation against the former employer
of the Department of Education official whose office
supervised the Kentucky-based Decker College.
Weld claims that an accreditation agency canceled
its approval of Decker’s programs under pressure
from the official. When Decker lost accreditation, it
fell into bankruptcy. Davis wants the department to
investigate.

U.S. Department of Education spokesman Justin
Hamilton told USA TODAY that the official’s work was
“unbiased” and said department officials “do not
plan on taking any further steps.”

For his part, Weld said he has discovered the limits
of his political influence. “It’s been very frustrating
because you can’t get answers,” he said. “I had been
accustomed to getting answers. But I guess when
you are out, you are out.”

Anderson, 44, a political newcomer, has seen his
idea take off. On the recommendation of a business
contact, he hired Larry LaRocco, a former Idaho
Democratic congressman-turned-lobbyist.

LaRocco and a lawyer with banking experience
helped turn the idea into a legislative proposal,
which LaRocco took to aides on a House
subcommittee that oversees consumer-credit issues.
Ohio Rep. Mary Jo Kilroy, a first-term Democrat,
sponsored the bill. “People who are paying off
medical debt should not be penalized,” she said.

Not everyone supports the plan. Anne Fortney, a
former Federal Trade Commission official who has
testified against the change, said unpaid bills,
including medical debts, that require the
intervention of a collection agency help lenders
predict whether consumers will pay future bills on
time.

Anderson insists he’s pursuing the project to help
average people, such as Doug Wickwire, 57, from
Lucas, Texas, who co-owns a company that builds
trade-show exhibits. He discovered this year that he
would be hit with $8,500 in fees to refinance his
home because of three paid medical collections, all
less than $200. “I feel like I’m getting screwed
around by the system,” he said.

“Is it going to be good for business? Potentially,”
Anderson said of the bill. “Am I going to make up
my investment? Probably not.”

LaRocco, who has lobbied for more than a decade,
said he has never represented a private citizen
before. Anderson has proved a quick study, going
from political novice to checking the Library of
Congress‘ bill-tracking site each day, LaRocco said.
“Now, he calls me up to say, ‘Hey, we’ve just added
another co-sponsor.’ “