Medical Debt Attorneys in Colorado Springs, Colorado

A serious health issue, severe illness, or outstanding medical expenses can accumulate and put you in huge medical debt. Fortunately, individuals who are overburdened with medical debts may be eligible to seek financial relief by filing for bankruptcy. If you want to know your rights and options for eliminating or paying off medical debt, consulting with an experienced Colorado bankruptcy attorney is a must. 

At Kinnaird Law Firm, we’re dedicated to offering comprehensive and knowledgeable guidance to clients in bankruptcy and medical debt-related matters. Our trusted attorneys are available to discuss your unique circumstances and enlighten you about how filing for bankruptcy can help pay off or eliminate your medical debts. In addition, our reliable team can guide you through the medical debt bankruptcy process and help you make informed decisions. 

Kinnaird Law Firm proudly serves clients across Colorado Springs, Colorado, and surrounding communities throughout El Paso County and Douglas County. 

Medical Debt and Bankruptcy 

Medical debt can accumulate from receiving health care services, including medical treatments, surgery, physiotherapy, and other related medical costs. Here are some of the most common reasons for incurring medical debts: 

• unpaid medical and treatment costs 

• high cost of receiving medical treatments 

• inadequate medical insurance policy 

• medical debt from injuries or chronic health conditions 

• medical debts from high insurance premiums 

• high deductibles 

• high cost of prescriptions or medications 

• changes in medical coverage 

Thankfully, you may be able to wipe out or discharge your accumulated medical debts by filing for bankruptcy or exploring other debt-relief options. 

Will Bankruptcy Discharge Medical Debt? 

Medical bills are usually categorized as non-priority unsecured debts and may be discharged or eliminated when you file for Chapter 7 or Chapter 13 bankruptcy. As a result, you may only be required to repay part or none of your medical debts, depending on the chapter you’re filing. However, an outstanding medical debt or bankruptcy discharge can adversely affect your credit score. 

Chapters That Help With Medical Debt  

Filing for protection under Chapter 7 or Chapter 13 bankruptcy are among the possible ways to wipe out your unpaid medical debts. 

Filing Chapter 7 for Medical Debt  

Chapter 7 bankruptcy is designed to help individuals and business owners eliminate most of their general unsecured debts, including personal loans, medical expenses, and credit cards. A trustee will be appointed by the Colorado court to handle your bankruptcy case. Furthermore, qualifying for Chapter 7 requires passing the bankruptcy means test. At the end of your case, your medical debts will be discharged. 

Filing Chapter 13 for Medical Debt  

Conversely, individuals who earn a decent income but have a huge medical debt burden may seek relief through Chapter 13 bankruptcy. This involves proposing a structured repayment plan (over three to five years) to pay back your medical debts with your potential income. Depending on your unique situation, you may only need to repay part of the medical debts. Also, the remaining medical debts will be discharged at the end of your Chapter 13 repayment plan. 

How Medical Debt Can Affect Credit Scores 

Unfortunately, defaulting on your medical debts can hurt your credit score. The medical provider will turn your outstanding medical debt over to a debt collector. Debts of over $500 will show up on your credit report if you fail to pay after one year. Also, the debt collector will keep contacting you until you fulfill your medical debt obligations. Once the medical debts are cleared, they will be removed from your credit report right away. 

However, if you’re unable to make the payments and you end up filing for bankruptcy, your credit score will nosedive. It may reduce anywhere between 160 and 220 points, based on the bankruptcy chapter you’re filing. With a bad credit score, you may experience various difficulties in qualifying for future loans. 

Pros & Cons of Filing for Medical Debt Bankruptcy  

Here are some advantages and disadvantages of filing for medical debt bankruptcy: 

Pros 

• helps you achieve medical debt relief 

• offers you the fresh financial start you need 

• eliminates all or most of your medical debts 

• no need to deal with third-party debt collectors 

• allows you to settle your medical debts for less than you owe 

• activates an automatic stay which prevents the debt collector from garnishing your wages, collecting money, seizing your property, or taking any legal action against you 

Cons 

• affects your credit score negatively 

• some of your assets may be sold in bankruptcy 

• not advisable if you owe other secured or non-dischargeable debts 

• getting future medical treatments may be difficult  

A seasoned Colorado medical debt attorney can help you decide whether to file for medical debt bankruptcy and guide you through the legal procedures involved. 

Work With Trusted Bankruptcy Attorneys 

Filing for medical debt bankruptcy in Colorado can be quite complicated and may involve a lot of paperwork. However, before you file, it is crucial to understand your options, the benefits, downsides, and eligibility requirements to help you make the right decisions. A trusted bankruptcy attorney can enlighten you about your options and help protect your rights. 

At Kinnaird Law Firm, our lawyers are poised and ready to advise and guide consumers in the legal matters of medical debt bankruptcy. Using our extensive knowledge, we can help file your bankruptcy petition, represent you intelligently in court, and help negotiate a fair debt resolution.