A sudden illness or injury that results in a trip to the hospital can significantly hurt your financial health if you do not have the funds to cover the medical bills or health insurance. Unfortunately, millions of Americans are also suffering from medical debt. In fact, a recent study found that Americans have a combined medical debt of $140 billion. Fortunately, you can manage your medical debt by filing for bankruptcy.
What Will Happen to My Medical Bills When I File for Bankruptcy?
Filing for bankruptcy is among the most effective options to reduce or completely eliminate medical debt. With a Chapter 7 bankruptcy, your medical debt, along with all your dischargeable debt will be erased. However, you must let go of some of all your assets, which can include your house.
In addition, you can only file for Chapter 7 every eight years, which means that it may be a short-term fix if you’re dealing with a chronic health issue. A chronic health issue requires costly and ongoing treatment, so you will acquire more medical bills after you’ve already filed for bankruptcy and will need to wait another eight years to file for Chapter 7 again.
If you have different types of debt on top of your medical bills, a more suitable option may be a Chapter 13 bankruptcy. When you file for Chapter 13 bankruptcy, you will not have to give up your assets. Instead, you must agree to repay all or some of your debt within three or five years.
If you are swimming in medical bills and are also falling behind on your vehicle or mortgage loan payments, a Chapter 13 bankruptcy can help you stabilize your finances. Take note, however, that there are limits to the amount of debt you will be allowed to discharge with a Chapter 13 bankruptcy.
What Happens If I Cannot Pay My Medical Bills?
Healthcare providers, hospitals, and clinics are very aggressive when it comes to debt collection. Besides sending threatening letters and calling you all the time to remind you of your bills, they may also sue you to get a judgment against you. If they win their case against you, your bank account may be frozen, your wages garnished, and a lien may be attached to your home.
When you file for bankruptcy, your creditors will be legally prohibited from collecting debts until the conclusion of your bankruptcy case.
Seek Legal Advice From an Experienced South Carolina Bankruptcy Attorney Now
The sooner you act and address your mounting medical debt, the sooner you can get on with your life and fix your overall financial health. To learn how bankruptcy can relieve you of medical debt, discuss your case with our South Carolina bankruptcy attorney.
Please call the Reed Law Firm or send us an online message to schedule your case review with our South Carolina bankruptcy attorney. They can determine whether bankruptcy is the best recourse for you and explore other options to help you pay your medical bills.
