Can Filing For Bankruptcy Eliminate Medical Debt?

The Downsides of Discharge Medical Debt

While bankruptcy can provide relief when you have an overwhelming amount of medical bills, it does come with consequences that you should consider before proceeding. In general, bankruptcy will impact your credit score. Bankruptcy stays on your credit report for 7 to 10 years. This can make it difficult for you to get new loans and credit cards. Additionally, bankruptcy is a long and stressful process. It is crucial to have the right partner to help you correctly file. Having the right person helping you can also make the whole process less stressful. It is important to understand that not all debts can be eliminated when you file for bankruptcy. Student loans, taxes, and child support are a few examples of debt that cannot be removed through bankruptcy.

Is Chapter 7 or Chapter 13 Better For Medical Debt?

There are a few differences between Chapter 7 and Chapter 13 bankruptcy. Deciding between the two depends mainly on your financial situation. Chapter 7 bankruptcy is the faster and more straightforward option. With this option, most debts are typically removed within a few months, but you will need to meet certain requirements to be able to file for Chapter 7. After you qualify, there is a risk that you may lose some of your non-exempt assets. Chapter 13 Bankruptcy doesn’t immediately erase your debt. With this type of bankruptcy, you will need to pay back the portion of debt that is in your repayment plan. Repayment plans typically take anywhere from 3 to 5 years to pay off. Only after your plan is paid off will any eligible debts be removed. To better understand the differences and figure out which plan is right for you, contact one of our bankruptcy attorneys. Our attorneys can help you decide which plan is right for you and your debt situation.

Who Can Qualify For Chapter 7 Medical Bankruptcy?

Not everyone can qualify for Chapter 7 bankruptcy. There are a few requirements that you need to meet to be eligible to receive debt relief. You have to undergo a means test, which compares your income to the median income in your state. If your income is below the average median for a household of your size, you can qualify for Chapter 7 bankruptcy. You can also only qualify for Chapter 7 if you have not filed within the past eight years or filed for Chapter 13 within the past six years.

Who Can Qualify For Chapter 13 Bankruptcy?

Chapter 13 bankruptcy is primarily used by individuals who have a steady source of income and can pay off their debts over time. To qualify, your secured debts must be less than a certain amount, and your unsecured debts must be below a certain threshold.

How To File For Bankruptcy And Eliminate Your Debt

Applying for medical bankruptcy is a tedious process, and you want to make sure all of your paperwork is correct and filed properly. To ensure that all forms are filed correctly, working with a bankruptcy attorney can make the filing process less stressful, and the process can move along quickly. Our attorney will work with you on gathering a list of all of your debts, income, assets, and monthly expenses. Next, the court requires you to complete a credit counseling course that will help you understand your financial situation and how bankruptcy works. This helps educate all individuals wanting to apply for bankruptcy on all of the options they have and helps to make sure that this is the route they want to take to get their debt under control. After the course is complete, your attorney will submit a bankruptcy petition. After filing, you will attend a meeting of creditors where you will answer questions about your finances under oath. If your case is approved at this meeting, your debt and unpaid bills will be removed, or a payment plan will be set into place.

Alternatives To Managing Your Medical Debt

Bankruptcy is not the only option you have to relieve yourself of bills and medical debt. One way to get a handle on your medical debt and bills is to work with your healthcare provider and see if they are willing to lower your balance or set up an interest-free payment plan. You can also request a medical billing advocate who can help you understand your medical bills and review your statements to make sure there are no errors or overcharges. If you have debt in many places, you can consolidate your debt into one loan or use a credit counseling agency. This can help you combine your balances into one payment plan. Lastly, if you have limited income, you can look towards charity care programs that may cover parts of your bills under a non-profit assistance organization.

Jump Legal Can Help You Eliminate Medical Bills

We understand that medical debt can be overwhelming, and you may not know where to start. At Jump Legal, we can help you understand all of the options that are available to you that can help you regain control of your finances and bills by finding ways to discharge medical debt. Our attorneys will help you understand the differences between Chapter 7 and Chapter 13 medical bankruptcy and how each option will impact your life. We will help you navigate your options and help you make an informed decision that you are comfortable with. We can help you find financial freedom.

Jump Legal Can Help You Receive A Bankruptcy Discharge

Give Jump Legal a call today and speak to one of our attorneys about how to erase medical debt. We are here to help you take control of your finances and bills to find financial stability. Bankruptcy discharge is a great way to help you have a fresh start, and Jump Legal can help you into this next chapter in your life.