If you’ve incurred a large amount of medical debt, it can be a stressful situation in which you may feel you have no place to turn. There are, however, options available that can help eliminate medical bills. Debt accrued from medical procedures, hospital stays, and unexpected injuries is the leading cause of bankruptcy, and you can, in fact, eliminate all medical debt with bankruptcy.
Medical Debt in Bankruptcy
One of the initial steps of filing for bankruptcy is to create a full list of all debts you have, which are then classified as either secured, unsecured, or priority debt by the bankruptcy court. While secured and priority debts must typically be paid back, unsecured debt is usually discharged or wiped out completely at the end of your bankruptcy process. Medical debt in bankruptcy is treated as an unsecured debt and thus is usually completely eliminated by either chapter of bankruptcy.
Qualifying for Bankruptcy
Your medical debt is handled differently depending on which chapter of bankruptcy you qualify for. In Chapter 7 bankruptcy, any amount of medical debt will be eliminated within 4-6 months of the confirmation of your bankruptcy. Chapter 7 bankruptcy is slightly harder to qualify for than its counterpart, Chapter 13 bankruptcy. If you don’t qualify for Chapter 7 due to having too high of an income, you may still be able to file for Chapter 13 bankruptcy, where you medical debt will be combined with all other unsecured debt. Once combined, you typically pay a small amount of all your unsecured debt based on your income and family size. Chapter 13 repayment usually takes 3-5 years, but at the end, all of your leftover unsecured debt is discharged.
Contact a Bankruptcy Attorney
If you are struggling with medical debt, bankruptcy can certainly help, but may not be the best answer for you. Most bankruptcy lawyers in your area are ready and willing to sit down and review your situation to help you decide the best course of action based on how much property you own, your income level, and how much medical debt you have. Calling a Houston bankruptcy attorney about medical debt will usually not cost you, but the outcome may save you an enormous amount of money.