Van Nuys Medical Debt Lawyer
Health care is one of the biggest issues in California, and throughout the United States. Millions of people have trouble paying their medical bills, particularly after an unexpected event such as a heart attack or debilitating injuries after a car accident. When individuals are uninsured or do not have enough health insurance, they often think about filing Chapter 7 bankruptcy. Our Van Nuys medical debt lawyer can help you through the process so you can manage all of your debt.
Types of Debt in Chapter 7 Bankruptcy
When filing bankruptcy, your debt is separated into different categories. These are as follows:
- Secured debt: This category includes debts that are attached to collateral that can be repossessed or foreclosed. Medical debt is not categorized as secured debt.
- Unsecured debt: Unlike secured debt, unsecured debt is not attached to property. Unsecured debt is given the highest priority in Chapter 7 bankruptcy and so, it is discharged before any other type. Unsecured debts are further divided into subcategories. These are priority and non-priority unsecured debt.
- Priority debt: Priority debts cannot be discharged during bankruptcy. Alimony, child support, and certain types of tax debt are considered priority debts and will survive a bankruptcy.
- Non-priority general unsecured debt: This category of debt is the last to be discharged during bankruptcy. The majority of these, with the exception of student loans, are discharged during bankruptcy.
Medical bills are treated as non-priority general unsecured debts. This means that you can likely discharge them during bankruptcy.
Other Options for Medical Debt
While Chapter 7 may eliminate your medical debt, not everyone qualifies. To be eligible for Chapter 7 bankruptcy, you must pass the means test. This means you must earn an income below the average income in California, or you must have insufficient income to repay your debt.
Even if you do not qualify for Chapter 7, you may be able to file Chapter 13 bankruptcy. This does not eliminate your medical debt, but it restructures it into a repayment plan. Chapter 13 repayment plans extend between three and five years, giving you much longer to repay the debt.
Although Chapter 7 and Chapter 13 can both help you manage your medical debt, they are not the right choice for everyone. Bankruptcy should only be a last resort, as it will negatively impact your credit score. Negotiating a settlement with the provider may be an option that allows you to repay less than the original debt owed.
Our Medical Debt Lawyer in Van Nuys Can Help Determine the Option Right for You
You have many options when your medical bills are piling up and you do not know how you will pay them. At Wadhwani & Shanfeld, our Van Nuys medical debt lawyer can review the facts of your case, explain your options further, and help you decide which one is right for you. Call us now at 818-658-2669 or contact us online to request a consultation and to get more of the information you need.
