The top three credit agencies will change the way they handle errors and list unpaid medical bills due to a giant industry overhaul, an article in The Wall Street Journal said.

Under an agreement announced Monday with New York state, Equifax Information Services, Experian Information Solutions and TransUnion will be more proactive in resolving disputes over information contained in credit reports—a process federal watchdogs and consumer advocates have long decried as being stacked against individuals.

Credit scores play a pivotal role in the housing market and are used by lenders to gauge what type of mortgage a borrower can get.

The settlement comes after more than a year of talks between the companies and New York State Attorney General Eric Schneiderman. His office began investigating their practices in 2012 after receiving complaints about errors on state residents’ credit reports and the onerous process to fix them, according to a spokesman for Mr. Schneiderman. The three firms agreed to a countrywide deal to avoid creating two systems for reporting. Such nationwide deals, said the spokesman in an email, are common when individuals are affected across the country rather than in a single state.

One noteworthy change that the article said was that credit-reporting firms will now have to wait 180 days before adding any medical-debt information to consumer’ credit reports. This will give consumers time to clear up any discrepancies and catch up with other unpaid bills.