Even the most financially responsible people are subject to situations that are beyond their control. While you may have a reasonable amount of savings and a reliable job, medical issues that are not covered by insurance can have the power to land anyone in a very stressful situation.
If your financial situation has been damaged by unforeseen medical bills, it is likely that you are feeling stressed and overwhelmed. Needing to deal with health concerns as well as financial concerns can seem impossible at times, but by taking action to understand the law, you may be able to gain a fresh financial start.
How can Chapter 7 bankruptcy target medical debt?
Chapter 7 bankruptcy makes it possible for debtors to have a significant amount of their debts discharged. It is possible to have medical debts discharged in Chapter 7 bankruptcy, provided that you meet the criteria for filing.
What are the criteria for making a Chapter 7 bankruptcy filing?
In order to file, you must pass a means test. This means test is based on your household income and outgoings. You are only eligible for Chapter 7 bankruptcy if it is determined, through the means test, that you would be unable to afford repayments under a Chapter 13 bankruptcy repayment plan.
There are several options available to you if you are struggling with overwhelming medical debt. You may be able to negotiate with creditors or modify repayment plans. However, if you decide that Chapter 7 bankruptcy could be the best option for you, it is important to prepare sufficiently and plan ahead.