Could Chapter 7 Bankruptcy Eliminates My Medical Bills ?
The heavy medical cost and less coverage insurance is burning issue in America. The total system unfairly affects the middle class people. The losers are patient’s approx sixty percent. In US people are facing the burden of excessive medical bills.
Types of debt
But there are some ways also to get rid of heavy burden of medical bill. There are two types of chapters for avoiding this problem. One is chapter 7 medical debt and another one is chapter 13 medical debt. Let’s discuss the matter ,
Chapter 7 Medical Debt– This may be a good choice for the persons who don’t earn a lot of money and have little assets or no equity. This is a four to five month process. In this process there are four types of medical debt. Let’s discuss the matter-
- Secured Debt–A creditor has a secured debt if he or she has property and can foreclose it if you fail to make your loan payments. This is because the debt is treated to be secured by the property which acts as a collateral. The most common example is mortgage and car loan. Medical debts are normally not secured by any property so they are not considered secured debts.
- Unsecured Debt– This type of debt is not secured by a piece of property which is further divided into priority and non priority categories.
- Priority Debt– These types of debt are usually non dischargeable as and paid before most other debt in chapter 7 bankruptcy.Though medical debts are not included in this category.
- Non Priority General Unsecured Debts– This type of debt like as unsecured personal loan, credit card and medical debt are relieved without any re payment in bankruptcy.
Chapter 13 Medical Debt-It is good plan for those who don’t have any assets and in that case they will have to pay back a portion of the medical debt through the repayment plan and then the rest of the money will be discharged.
Medical Debt Treated in Chapter 7 Bankruptcy & Solution
So medical debt is treated in chapter 7 bankruptcy as it falls under the category of non priority general unsecured debt in chapter 7 bankruptcies. If you are struggling with heavy medical debt then chapter 7 bankruptcy is the easiest way to get relief from this heavy burden of debt. Your medical debt will not receive priority if the trustee is able to make your payments to creditors and the rest of the money is relieved when you get discharged.