One of the most common reasons people in New York City fall into financial
straits is due to medical debt. Unexpected illnesses and injuries can
cause individuals to accrue thousands of dollars’ worth of medical
bills, especially if they are uninsured or underinsured. Fortunately,
individuals are often able to seek relief from their medical debt through
How Are Medical Debts Treated During Bankruptcy?
While some debts such as certain tax obligations and alimony receive special
treatment and cannot be discharged, medical debts are considered to be
general unsecured debts similar to credit card debt and do not receive
any priority treatment for repayment. Depending on the chapter under which
a person files, bankruptcy can allow a person to have a large amount of
their medical debts wiped clean in sometimes as little as just a few months.
Immediately upon filing for bankruptcy, debtors are provided with an “automatic
stay” which prevents collection efforts and many other forms of
creditor communication, allowing them to avoid relentless phone calls,
threatening communications, and concerns over being
sued for medical debt. For those who qualify for Chapter 7 bankruptcy, these debts along with
their other general unsecured debts can be wiped clean, though the process
may require a person to liquidate some of their non-exempt assets. Conversely,
with Chapter 13 bankruptcy, medical bills are lumped together with other
general unsecured debts into a 3-5 year repayment plan, after which any
remaining debts are discharged.
When Should I File?
If you are struggling under enormous amounts of medical debt, you may feel
pressured to file for bankruptcy as soon as possible to achieve relief.
This may be unwise, as you do not want to file for bankruptcy too soon.
If your medical condition requires further treatment, any additional bills
that are incurred after your filing date will remain your responsibility
and will not be able to be discharged. Since there is a lengthy waiting
period before a person may file for bankruptcy again, it is best to wait
until you have accrued all of the debts you will want to discharge.
Contact a New York Debt Relief Lawyer Today
At the Law Offices of Simon Goldenberg, PLLC, our award-winning
bankruptcy lawyers can help you pursue the cost-effective and practical legal solutions necessary
to help you overcome your medical debt. Our firm is easily accessable
to residents of New York City, with offices in Brooklyn and Long Island.
overwhelming support from past clients, we have what it takes to ensure your best interests are protected and
help you achieve a clean financial slate.
Call (888) 301-0584 today to discuss your legal options in detail.