A common misconception about bankruptcy is that only financially irresponsible people file. The reality, however, is that often many people are just one unexpected accident away from overwhelming debt. You or a loved one may fall ill, get into an auto accident, get hurt at work, or encounter any other serious event that leaves you hurt or out of commission. Regardless of the circumstances, facing high debt can be stressful and frustrating. You may be having a hard time making ends meet while trying to manage your medical debt. If you can relate, it may be time to consider filing for Chapter 7 or Chapter 13 bankruptcy.
As an individual, you may qualify for two types of bankruptcy: Chapter 7 and Chapter 13. Under Chapter 7, you may be able to discharge certain debts, including medical debts. If you file for Chapter 13 bankruptcy, you may be able to reorganize your debt instead of discharging it. This reorganization means that after your case is settled, you will make low monthly payments for a period of three to five years. Married couples can also file for Chapter 13 bankruptcy.
Once your case is filed, the bankruptcy judge will appoint a trustee regardless of the type of bankruptcy you pursue. This trustee will review your finances, and approve the next steps in your case. If it is a Chapter 7 case, the trustee will determine whether you have any liquid assets available to sell and make a payment on your debt. In a Chapter 13 case, the trustee will approve your proposed repayment plan when reorganizing your debt. Another responsibility your trustee has is meeting with your creditors. In some cases, creditors may challenge your bankruptcy case. Creditors may challenge the option to discharge their specific debt. Your creditors may also challenge your repayment plan in a Chapter 13 case. Your attorney can counter these challenges, and argue that your petition should be approved.
In both Chapter 7 and Chapter 13 cases, there are different priority levels for your debt. Unsecured debts are generally a lower priority, and may therefore be easier to discharge or reorganize. Medical debts are usually considered unsecured, since there is no collateral such as real estate or other property attached. However, this does not mean that your bankruptcy case will automatically be approved. Every case is different, and bankruptcy issues can be quite complex. It is important to consult with an experienced bankruptcy lawyer before filing. That way, you can fully understand your legal options and the effect bankruptcy will have on your life.
If you are considering filing for bankruptcy in San Francisco, contact the Law Office of Melanie Tavare today. Our experienced legal team will address your questions and concerns during a free consultation. We will work closely with you throughout the duration of your case. We understand the difficulties you are facing when dealing with high medical debt. Bankruptcy may be the best solution toward a more stable financial future. Call us today at (510) 255-4646.
The Law Offices of Melanie Tavare is a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.