Medical bill debt forgiveness has been around for some time. However, it has gained popularity as a method for debt reduction for those that are unable to pay their bills. It is a reasonable way to settle your debts without filing bankruptcy or garnishing your wages. However, you need to act quickly when you find yourself in this situation. Find out what you need to do to take advantage of this option.
To apply for medical bill debt forgiveness, you will need to contact your health care provider. Many people do not realize this. They believe that the provider will just write off the debt and you will never have to worry about paying the money back. This does not happen. This is one of the easiest ways for you to get out of debt when you are dealing with medical bills.
When you file bankruptcy, you do not get to keep any of your personal assets. This includes any assets in your bank account. With medical bills this includes your health insurance. Your health insurance company can reduce your bill by agreeing to write off part of the medical bill. This is not limited to just monthly premiums.
Filing for bankruptcy will affect you for 10 years after the bankruptcy happens. There is no guarantee that you will be able to re-establish a positive credit rating. If you cannot meet at least the minimum payments on your medical bill you could face foreclosure or repossession. You may even have to give up your home if you cannot meet the payments for at least a year.
Bankruptcy also means that you will have to pay all applicable taxes on your discharge. This can be a double whammy, as you have to pay taxes once and then pay insurance companies. You could also lose your freedom and be forced to give up your car or other vehicle. That is why medical bill debt forgiveness through bankruptcy is not recommended.
Debt settlement is another debt relief method that will allow you to wipe out large portions of your medical bill. For the large medical bills you can settle with your medical provider. The monthly payments will be lowered so that you are able to afford to make them. This is a good option for someone who has many doctor visits per year. It is not advisable for someone with only one or two doctor visits a year though.
If your medical bill debt is not too large and you are making regular payments, you can try a pay it in full plan. You will pay a small amount upfront and agree to make the payments on a monthly basis. This will work like a loan for most people because the payments are usually around two hundred dollars. If you cannot afford at least this much each month you will still be able to pay your doctor’s office fees and make some room in your pocket.
If you are unable to pay your medical bill in full even after using a pay it in full plan you may want to consider bankruptcy. There are people who have had to do just that and have been able to get back on their feet again. It is important to remember that bankruptcy will have a very negative impact on your credit report for at least seven years. Not only will you not be able to get another loan but your credit card will be blocked for at least seven years. Bankruptcy should only be used as a last resort when there are no other options.