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Illness and injury often contribute to bankruptcy

On Behalf of | Sep 12, 2019 | Chapter 13 Bankruptcy |

Many Virginia residents struggle to pay their bills each month. While this could be the result of financial irresponsibility, debt is often caused by unavoidable circumstances. For example, debt could be tied to an illness or injury within a household.

The reality is that many medical conditions are caused by issues outside an individual’s control. Accidents can happen at work, in the home or while on the road. Similarly, illnesses can strike at any time. When this happens, a worker could suffer financially in at least two ways — the cost of medical bills and having to take time off a job to either recover or to provide care to a family member.

In fact, those who have health insurance can find themselves affected by medical debt and reduced income. Even temporary illness or convalescence after an accident can do irreparable damage to the financial health of a household or individual.

A recent study of individuals who have filed for bankruptcy shows that over half of the subjects blamed the bankruptcy on medical bills. Over 44% indicated that illness-related income loss was the problem and many respondents indicated that both circumstances led to their current financial predicament.

Many people who are dealing with medical debt are reluctant to consider bankruptcy because they fear losing a home or other assets. A Chapter 13 bankruptcy presents the option of retaining assets while completing a payment plan. This can significantly reduce a debt load while protecting the debtor against collection activities.

Debtors considering bankruptcy may benefit from speaking with an experienced bankruptcy attorney. The lawyer could provide information about bankruptcy options and other types of debt relief.