How Chapter 7 & 13 Bankruptcy Can Provide Financial Relief for Medical Debt

When dealing with medical issues, the last thing you want to worry about is the financial burden that comes with them. Unfortunately, medical bills can stack up quickly, and it is not uncommon for individuals to find themselves drowning in debt.

This was the case for one of our clients, Susie. She felt overwhelmed, and her creditors were hounding her relentlessly, leading her to a dark place.

In this guide, we’re sharing how Susie found hope and relief through Chapter 7 bankruptcy and how it could help you, too.

It’s crucial to note that not all medical debt will qualify for discharge in Chapter 7 bankruptcy. However, it is still worth discussing your options with a bankruptcy attorney because alternative solutions are available, such as Chapter 13 bankruptcy (or debt settlement). An experienced attorney will assess your situation and determine the best course of action based on your circumstances.

How Bankruptcy Provides a Fresh Start

It’s understandable if you feel hesitant or embarrassed to file for bankruptcy. The truth is that bankruptcy was designed to provide a fresh start to individuals or businesses struggling financially. It’s not something to be ashamed of, and you are not alone. Many people have turned to bankruptcy to get a second chance.

Susie herself admitted that she felt relieved and grateful for the help she received, and it even saved her life.

Medical crises can be overwhelming, and the financial burden that comes with them only adds to the stress. The good news is that there are solutions to help you get back on track. Chapters 7 and 13 bankruptcy are options available that can eliminate your debts and give you a fresh start.

What is Chapter 7 bankruptcy (and how can it help with medical expenses)?

Chapter 7 bankruptcy is a legal process designed to help individuals and businesses eliminate unsecured debts, such as medical bills, credit card debt, and utility bills. This type of bankruptcy allows filers to discharge their debts, leaving them with a clean slate. This process may seem daunting, but an experienced bankruptcy attorney can guide you through it and ensure that your assets are protected.

For Susie, Chapter 7 bankruptcy was the answer to her prayers. She had accumulated medical bills that were putting a lot of pressure on her, and her creditors’ relentless calls only worsened her depression. As soon as we filed her case, the harassing phone calls stopped, and she felt a weight lifted off her shoulders. With her debts discharged, she could focus on her mental and physical health and rebuild her life.

What is Chapter 13 bankruptcy (and how can it help)?

Chapter 13 bankruptcy is another option that can help you manage medical debt. Unlike Chapter 7, which wipes out debts completely, Chapter 13 lets you create a payment plan that fits your budget. This plan typically lasts three to five years, and during this time, you’ll make monthly payments to catch up on what you owe.

The great thing about Chapter 13 is that it stops collection calls and wage garnishments right away. It also lets you keep your property (like your home or car) while you work through your payment plan. For medical debt, this means you can pay back what you can afford without losing everything you’ve worked for.

Many people in Oregon & Washington choose Chapter 13 when they have a steady income but just need help organizing their debts.

Medical Crises in Bankruptcy

Medical emergencies don’t wait for the right time to happen. One day you’re healthy, and the next you might face surgery, a serious diagnosis, or an accident. Even with insurance, the bills can pile up fast. Co-pays, deductibles, and treatments not covered by insurance can quickly add up to the thousands of dollars.

When a medical crisis hits your family, bankruptcy can be a lifeline. Both Chapters 7 and 13 treat medical bills as unsecured debt, which means they’re given lower priority than secured debts like mortgages.

So if you are in a situation like Susie’s, help is available, and it doesn’t cost anything to call and discuss your options. Don’t suffer in silence. Take that first step towards finding financial freedom.

Contact Experienced Bankruptcy Attorneys for the Help You Need

The bankruptcy attorneys at OlsenDaines are here to help you with every step of the bankruptcy process. We are the largest and most experienced consumer bankruptcy law firm in the Pacific NW, with offices throughout Oregon and Washington. We can address your financial difficulties with the expertise and careful planning you are seeking.

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