Can You Get Rid Of Medical Debt If You File For Bankruptcy?

How To Recover From Medical Debt After Filing For Bankruptcy

If you’re overwhelmed with medical bills, you may be wondering whether filing for bankruptcy can eliminate your medical debt. The answer is yes; medical bills can be discharged through bankruptcy. In fact, medical debt is one of the most common reasons why people file for bankruptcy. Consulting with your Gilbert bankruptcy lawyer can help you better understand the process and which type of bankruptcy might be right for you.

Medical Debt When Filing For Bankruptcy In Arizona

Filing for Bankruptcy to Discharge Medical Debt

Filing for bankruptcy can be a solution to medical debt, but when you file, you must include all of your debt. Other debts that can be discharged through bankruptcy include:

  • Credit card debt
  • Utility bills
  • Rent or lease payments
  • Gym memberships and other types of memberships
  • Personal loans
  • Payday loans
  • Mortgages, auto loans, and other secured debts, although you’ll need to return the property to the lender
    Some bills and obligations cannot be discharged through bankruptcy. Nondischargeable debts include:

  • Child support
  • Alimony
  • Recent tax debts
  • Federal student loans

    When Should I File For Bankruptcy?

    Timing your bankruptcy is crucial, so be sure to consult with your Gilbert bankruptcy attorney before filing any documentation. The frequency of bankruptcy filing is limited; if you incur additional bills after your first bankruptcy, you will be unable to file again for eight years or longer. It’s important to make sure your medical condition has stabilized and that you can handle an unexpected financial crisis before filing.

    Medical Bills Under Chapter 7 Or Chapter 13 Bankruptcy

    Both chapters of bankruptcy will discharge medical debts, but they work differently. You may only qualify for one type of bankruptcy or the other. You’ll need to consider your income and qualifications, whether you want to keep your property, and other factors.

    Chapter 7 Bankruptcy

    Chapter 7 bankruptcy quickly discharges all of your debts. You’ll be able to eliminate your medical bills, credit card debt, personal loans, past-due rent payments, and some other types of debt. Although some of your property will be protected in Gilbert Chapter 7 bankruptcy, the bankruptcy trustee will garnish some of your personal property in order to pay what you owe. This means any luxury vehicles, second homes, and other valuables will be used to pay back your creditors. You may also lose your home, vehicle, and other property with a secured loan if you owe significant amounts of debt on them.
    Not everyone will qualify for a Chapter 7 bankruptcy, but if you choose to file this chapter, the bankruptcy will remain on your credit for ten years and have a longer impact on your future.

    Chapter 13 Bankruptcy

    This type of bankruptcy is essentially a restructuring of your debts. Your medical debt and most other debts will ultimately be discharged, but you will make monthly payments on your debts for a 3-5 year period, after which the remainder of your debts will be forgiven. An advantage of Gilbert Chapter 13 bankruptcy is that you’ll be able to keep your home, vehicle, and other property. Chapter 13 can also be a good option if you have tax debt or other nondischargeable debts. You’ll be able to catch up with affordable payments over a time that will be determined by a bankruptcy trustee within certain guidelines.
    Like Chapter 7 bankruptcy, not everyone will qualify. There are debt limits to Chapter 13 bankruptcy, and you must have a sufficient minimum income. However, bankruptcy filing will only remain on your credit for seven years, making it easier for you to rebuild your finances and credit in the future.

    Which Type Of Bankruptcy Is Right For Me?

    When it comes to filing for bankruptcy, there are many factors to consider with your Gilbert bankruptcy law firm. Filing for bankruptcy isn’t the best choice for everyone; you’ll want to carefully consider some of the following questions:

  • Has my illness or injury resolved, ending my medical bills, or am I anticipating another significant financial crisis?
  • Have I applied for payment assistance through the hospital and exhausted all other payment plan options?
  • Do I have other debts that could also be eliminated?
  • Is my income low enough to qualify for Chapter 7, or do I have too much debt to qualify for Chapter 13?
  • What does my attorney recommend?
    If you and your attorney determine that filing for bankruptcy is your best option, you can expect to receive constant guidance and assistance from your bankruptcy lawyer as you go through the process.

    Get More Information About Bankruptcy from a Leading Attorney Firm

    Learn more about your options for eliminating medical debt when you consult with the attorneys at Gilbert Bankruptcy Lawyers. Our experienced attorneys will carefully consider your situation and help you make the best decision. Let us help ease the burden of overwhelming medical debt. Contact us today to schedule your free case review.


    Gilbert Bankruptcy Lawyers
    Office: 480-448-9800

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