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Is it possible to declare bankruptcy on medical bills?

On Behalf of | Feb 7, 2023 | Bankruptcy |

If your medical bills are an increasing burden on your finances, you’re probably looking into all options for finding some relief. One such option is bankruptcy, but many people aren’t aware that they can discharge medical debt through bankruptcy in Virginia.

You can get rid of your medical debt through bankruptcy, via Chapter 7 and Chapter 13 bankruptcy. However, it’s impossible to declare bankruptcy specifically and only for medical debt.

Bankruptcy and medical debt

A few types of debt can’t be discharged in bankruptcy, such as taxes, spousal and child support and certain types of student loans. But medical debt can be discharged or mitigated in a bankruptcy proceeding.

No such thing as a medical bankruptcy

While getting medical debt relief through bankruptcy is possible, keep in mind that the only way to do so is through filing Chapter 7 or Chapter 13 bankruptcy.

In either case, the proceedings focus on your debts, income and assets. There’s no option for partitioning off only your medical debts while leaving any other debts you might hold, such as a mortgage, auto payment or credit card debt, not factored in the bankruptcy proceeding.

A bankruptcy proceeding will cause some disruption in your life, though this disruption may be preferable to dealing with an ongoing debt burden. With a Chapter 7 bankruptcy, you may have to liquidate some assets to resolve the bankruptcy.

Keep in mind also that you’ll need to qualify for each type of bankruptcy. With Chapter 7, your income needs to be below a certain threshold. And with Chapter 13, you’ll need to be able to demonstrate steady income able to fund a payment plan.

If medical debts are weighing you down, bankruptcy is a viable option. But be aware that your financial situation will be under assessment if you go that route.