Laws That Help Protect Military Veterans’ Credit

Learn how federal law will provide credit reporting protections for veterans regarding certain medical debts. Also, find out ways that veterans and military servicemembers can protect their credit.

On May 24, 2018, President Trump signed the Economic Growth, Regulatory Relief, and Consumer Protection Act into law. Effective May 24, 2019, a section of this law amends the Fair Credit Reporting Act to give credit reporting protections to military veterans regarding specific kinds of medical debts.

To learn more about how this law affects the credit reporting of veterans' medical debt, as well as find out how veterans and active-duty servicemembers can protect their credit, read on.

Federal Restrictions on the Credit Reporting of Veterans' Medical Debt

The FCRA amendments require that, as of May 24, 2019, certain information related to a veteran's medical debt must be excluded from that veteran's credit report.

Certain medical debts can't be included in a credit report until they're over a year old. Generally, the law prevents a nationwide credit reporting agency—like Equifax, Experian, and TransUnion—from including specific kinds of veterans’ medical debts in a credit report until the debt is more than one year old.

Additionally, the agency has to remove any information about medical debt that is characterized as delinquent, charged off, or in collection once the debt is fully paid or settled.

The law provides a process for disputing medical debt that improperly shows up in a credit report. The law also provides a process for veterans to dispute the inclusion of a particular medical debt in the veteran's credit report and requires the VA to set up a database by May 24, 2019, so the credit reporting agencies can verify the veteran’s actual medical debt.

Steps Veterans and Servicemembers Can Take to Protect Their Credit

If you're a veteran or active-duty servicemember, you should keep an eye on your credit reports and consider freezing your credit files at the three major credit reporting bureaus—especially if you’ve been the victim of a data breach, like the one at Equifax in 2017. Active-duty servicemembers who are concerned about protecting their credit can also consider signing up for free credit monitoring (available as of May 24, 2019) and placing an active duty fraud alert on their credit file.

Monitoring Your Credit Reports

Everyone should proactively monitor their credit reports. You’re entitled to get one free report every twelve months from the three major credit reporting agencies (Equifax, Experian, and TransUnion). If you get one report every four months, you can review your credit history for no cost on three separate occasions over a one-year period. Each time you pull a report, review it for mistakes and inaccuracies. Then, dispute any incorrect information. To get your reports, go to

Placing a Credit Freeze on Your Credit Files

If your personal data was stolen in a data breach, or you’re the victim of identity theft (or you think you might become a victim), it's probably a good idea to freeze your credit files. Placing a credit freeze—sometimes called a security freeze—on your credit file at each of the three major credit reporting bureaus (again, Equifax, Experian, and TransUnion) is often the best way to protect your credit and stop an identity thief from opening new accounts in your name.

By placing a freeze on your account, any third party who attempts to pull your credit will get a message that the account is frozen and won’t be able to access the file. Because creditors almost always look at a consumer’s credit before giving a loan or extending credit, a freeze usually prevents a criminal from opening up new accounts using your identity. (To get a checklist of the recovery steps you should take if your identity has been stolen, see Stolen Identity? Take These Recovery Steps.)

State laws typically require most people to pay a fee of between $2 and $10 each time they place, temporarily lift, or remove a credit freeze. But under federal law, credit freezes will become free for everyone—no matter which state you live in—as of September 21, 2018.

Free Credit Monitoring for Active-Duty Servicemembers

As of May 24, 2019, federal law requires the credit reporting bureaus to provide free notifications when an addition or modification is added to a servicemember’s credit file. This kind of monitoring service, however, while free to servicemembers, is considerably more limited than what commercial credit monitoring products currently offer. Commercial products (those that you have to pay for) usually include notices about activity on your account, as well as surveillance of black market websites for your personal information and, sometimes, identity theft insurance.

Active Duty Fraud Alerts

Active duty military servicemembers can add an active duty fraud alert to their file that remains in place for 12 months. After requesting a fraud alert, a creditor has to take extra steps to verify the identity of a person applying for credit, like a loan or a new credit card account, before approving the transaction.

Getting Help

If you’re a veteran and you need help dealing with your debts, consider talking to a debt settlement lawyer. A debt settlement lawyer can help you dispute incorrect information in your credit report and assist you in dealing with debt collectors.

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