Unexpected medical bills can financially devastate a family for many years to come. Luckily, most medical bills in bankruptcy are eligible to be discharged. See Bankruptcy law 11 USC 424. This is because medical bills in bankruptcy are almost always unsecured debt. Unsecured debts are loans in which the debtor does not provide any collateral for the loan. Other examples of unsecured debts can include credit cards, student loans, rent, and gym memberships. When a debt is discharged in bankruptcy the borrower will be released from all liability on the debt. For more information on how specific medical bills in bankruptcy would treated by current bankruptcy law contact a Tampa bankruptcy lawyer for advice.
Medical Bills in Bankruptcy – Chapter 7
Generally, there are two different types of bankruptcy to choose from, Chapter 7 and Chapter 13 bankruptcy. If a debtor is interested in retaining assets and paying their medical bills in bankruptcy, then Chapter 13 may be a good option. On the other hand, if a debtor cannot afford to make the payments required under Chapter 13 and wants to wipe out medical bills in bankruptcy, a Chapter 7 bankruptcy may be more appropriate.
In Chapter 7, the debtor does not make monthly payments to their creditors. Instead, non-exempt assets may be liquidated to pay back the debts. Exempt property is property that you do not have to forfeit when filing for bankruptcy and are entitled to keep. Before you file for bankruptcy it is important to know which exemptions you qualify for. The amount and type of exemptions you are eligible for may greatly impact your decision on whether to file for bankruptcy, and if so either Chapter 13 or Chapter 7. Fortunately, an experienced Tampa bankruptcy attorney should be able to advise you on which assets may qualify as exempt prior to filing for bankruptcy.
Medical Bills in Bankruptcy – Chapter 13
Unlike Chapter 7 , a Chapter 13 requires a debtor to create a payment plan. Click here for more information on Chapter 13 payment plan. Under Chapter 13, unsecured debts must be paid the same amount they would have received in Chapter 7. Therefore, the amount of medical bills in bankruptcy that will be paid depends on the specific facts of each case. In some cases, a debtor will not have to pay anything towards medical bills in bankruptcy. However, in other cases they will be required to pay a significant portion of the remaining medical bills.
If considering filing for bankruptcy you should speak to a bankruptcy attorney at the earliest possible opportunity. It is highly recommended to be specific about the type of debt owed and what your goals are for the medical bills in bankruptcy. If you have a substantial amount of medical debt y Chapter 7 might be a good option. However, if wanting to attempt repayment a Chapter 13 may be your best option.
Bankruptcy Law Firm in Tampa
If you are burdened with medical bills or have a difficult time meeting your financial obligations Florida Law Advisers, P.A. can help. Our bankruptcy attorneys have years of experience helping people just like you solve their financial problems with medical bills in bankruptcy. We combine our experience and skills in the courtroom to help achieve the results our clients need. Call us today to schedule a free consultation with a bankruptcy lawyer at our firm.