You may be considering medical debt bankruptcy in NY if you have a substantial amount of medical bills that you can’t pay off on your own. Medical debt is quite common for New York residents and can often leave them with very limited options.
At Grady BK, PLLC, we strive to provide our clients with the legal expertise they need as they navigate debt relief for medical expenses. We understand how overwhelming this process can be, especially if you are worried about the repercussions of filing for bankruptcy. We will help you evaluate your New York medical debt solutions, personalizing our approach to fit your situation. In this article, we will be discussing how to approach medical debt bankruptcy in NY and how Chapter 7 and Chapter 13 handle medical expenses.
How Bankruptcy Addresses Medical Debt
The good news for Watertown, New York, residents is that bankruptcy can assist you in eliminating medical debt. This can help you to settle your debts and move forward towards a more stable financial future.
However, Chapter 7 and Chapter 13 bankruptcy both approach medical debt in different ways. That is why one type of bankruptcy may be better than the other, depending on your situation and which type of bankruptcy you qualify for.
A New York bankruptcy attorney can help you evaluate your financial situation as well as your bankruptcy options. They can also help you figure out which type of bankruptcy you qualify for since there are certain income requirements.
Chapter 7
Filing Chapter 7 for medical bills is a possibility if you are in over your head with medical debt. In many instances, Chapter 7 is the preferred option as it can help you eliminate the most amount of debt possible. However, you have to meet the income requirements; otherwise, you would need to choose Chapter 13.
Chapter 7 works by allowing you to have certain debt discharged so that it is no longer your responsibility to pay it back.
Chapter 13
Unlike Chapter 7 bankruptcy, Chapter 13 is a repayment type of bankruptcy, otherwise known as a wage earners bankruptcy. It is designed for individuals who have a steady income that goes over the minimum income for Chapter 7.
When you file for Chapter 13, you will be put on a 3 to 5 year repayment plan that requires you to pay back your debt. After the completion of your repayment plan, certain dischargeable debts can be discharged if they are remaining.
So, Chapter 13 can be a good option if you do not qualify for Chapter 7. Although, you will still be required to pay off certain medical expenses depending on your disposable income and the type of repayment plan created for you.
Pros and Cons of Using Bankruptcy for Medical Debt Relief
Before you proceed with filing for medical debt bankruptcy in NY, you need to weigh the pros and cons of this option. Although bankruptcy can be a very good option for those in a significant amount of debt, it also comes with restrictions.
Bankruptcy can be one of the best options for navigating medical debt, as it can help you discharge a large portion of these expenses. Of course, this is dependent on whether or not you file for Chapter 7 or Chapter 13. However, either way, whatever medical debt that is left over will be discharged so that you can have a fresh start.
Keep in mind, you may be able to qualify for medical assistance programs, or you may be able to create a monthly payment plan with your medical provider.
A bankruptcy attorney will be able to help you evaluate your financial situation to decide whether or not bankruptcy is the right choice.
FAQ Section
Does medical debt qualify for bankruptcy?
Yes, medical debt is considered to be dischargeable, whether you file for Chapter 7 or Chapter 13 bankruptcy.
Can hospitals still pursue collections after I file for bankruptcy?
When you file for bankruptcy, an automatic stay will be put in place, protecting you from any type of collection effort. This applies to all of your creditors, including hospitals.
Should I file for bankruptcy just for medical bills?
When you file for bankruptcy in New York, it is not possible to limit your claim to just one type of debt, such as medical debt. However, it may still be a good option to file bankruptcy if you only have significant medical bills, as these can be very difficult to pay off on your own.
Are there alternatives to bankruptcy for medical debt?
Depending on your financial situation and the amount of medical debt you have, there may be alternatives to bankruptcy. For instance, many people are able to create a payment plan with their medical provider, which allows them to pay monthly installments until their balance is paid off in full.
New York’s Top Compassionate Bankruptcy Attorney
Do you need to get Watertown, NY, bankruptcy help as you navigate filing for bankruptcy for medical debt? At Grady BK, PLLC, we will help you with every step of the bankruptcy process, whether you are evaluating your options or you are ready to file. We can provide guidance as you navigate your debt relief options, especially if you are undecided on whether to file for Chapter 7 or Chapter 13 bankruptcy.
At Grady BK, PLLC, we will provide a personalized approach, taking into account your unique financial needs and goals. We can also help you better understand what comes after bankruptcy, such as the impact on your credit score and how you can move forward financially.
Contact us today at 315-299-9005 to discuss your financial situation with a New York bankruptcy attorney. Our team at Grady BK, PLLC, is here to help you as you navigate the bankruptcy process.
