St. Louis and St. Charles Bankruptcy Lawyer
September 10, 2018 Bankruptcy, Chapter 7 No Comments

Medical debt is one of the most common causes of financial problems in the United States today. Even if you’re insured, an unexpected injury or illness can leave with tens-of-thousands in medical bills, if not more. For many people, this kind of debt is simply unmanageable, so they do the only thing they can—ignore the bills and let them pile up.

Unfortunately, ignoring any type of debt will substantially hurt your credit, making it difficult to obtain financing for large purchases, get a credit card, or even get a job. But if you can’t pay it, and you shouldn’t ignore it, what can you do? This is where bankruptcy might be able to help.

Chapter 7 Basics

Chapter 7 bankruptcy is a type of bankruptcy that can completely eliminate certain types of debt, including medical debt. In Chapter 7, the bankruptcy trustee will sell off a debtor’s non-exempt assets and use the proceeds from the sale to pay off creditors. Any leftover debts will be discharged, provided that they are not within a few narrow categories of debt that are usually nondischargeable. Fortunately, medical debts are dischargeable, so Chapter 7 can often help people with unpaid medical bills get on their feet. Other types of debts that Chapter 7 bankruptcy can often eliminate include the following:

  • Credit card bills
  • Personal loans
  • Utility bills
  • Past-due rent
  • Auto loans
  • Certain tax debts
  • Civil judgments
  • Collection accounts

Is Chapter 7 Right for You?

After reading the material above, you may feel like you’re ready to head down to the courthouse and file your Chapter 7 bankruptcy today. After all, if you can eliminate all of your debts, including your unexpected medical debt, why not? It is important to keep in mind that there are certain drawbacks associated with filing, and you need to weigh these against the potential benefit you may obtain. Some of the things you need to consider include the following:

  • Your assets – If you have nonexempt assets, they will likely be seized by the bankruptcy trustee and sold off before you obtain a discharge.
  • Your income – If you can afford to make payments on your debt or settle it, it may be better to do so than to eliminate through bankruptcy.
  • Chapter 13 – If you earn a regular income, you may want to consider filing for Chapter 13 bankruptcy instead. While you will need to make payments to the court for three to five years, your assets will not be at risk.

Speak to a St. Louis and St. Charles Bankruptcy Lawyer about Your Debts Today!

If you have incurred significant medical debt and are having problems paying it off, you should speak to an attorney as soon as you can. A lawyer will be able to identify whether bankruptcy is a good option for you and may be able to help you eliminate your debt and obtain a fresh financial start. To schedule a free case evaluation with Bankruptcy attorney in St. Louis, call the Law Offices of Kenneth P. Carp today at (636) 947-3600 or contact us online.

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