Question Girlfriend in Medical Debt, No Assets. Should she claim Bankruptcy?

[Beacon1]

As I said in the subject, my girlfriend is in for atleast $40,000 in Medical Debt. She has no assets whatsoever and is 27 years old. She does have a job working at a hospital. Should she claim Bankruptcy? Is there such a thing as "medical bankruptcy?"

If she does claim Bankruptcy, does her debt get wiped clean? How long will this affect her credit. If we got married, would it affect my credit?

Thanks for all of your help… any advice or knowledge on this subject would be appreciated.

Thanks!

-Steve

[keepmine]

There is just plain old bk. The term medical bk doesn't exist. All that means is, medica debtl caused the bk.
Yes, medical debt is unsecured and can be discharged along with cc's, auto loan deficeicies, etc.
The bk will be in the public record section of her credit reports for 10 years. The only way it'll affect you is, your income and credit may have to carry the day if you need to finance something like a car or home for a few years post bk. The bk won't migrate over to your report.

She likely should file but, I'd not do it until she is covered by health insurance.

[angles]

Consider filing BK only to protect future earnings at least that is the way I look at it. If she has a good job the creditors may go after her knowing that they will eventually get their money. An alternative to filing BK is to contact the creditor and negotiate an affordable payoff but you have to be strong through the process.

[woeisme]

Does she have a chronic condition that reasonably could be expected to result in additional medical debt in the near-term future? If she files a CH 7 and then gets additional medical debt she wouldn't be able to discharge that with another CH 7 unless 8 years has passed I think (someone correct me if I have the timing wrong). How long between BK and between her credit getting restored depends on the chapter she files, CH 13 comes off credit reports in 7 years, CH 7 takes 10 years. The timing on filing also depends on chapter as well, which will depend on her income and ability to pass the means test. If she's in a CH 13 she will make payments on the debt for 3-5 years then the remainder gets wiped clean, in a no asset CH 7 (best case scenario) it all gets wiped clean with no payments except for her lawyer and filing fees.

[LadyInTheRed]

Welcome to BKforum, Beacon1

Should she claim Bankruptcy?

You have not given enough information to answer that question. How much income does she have? What is her household size and what contributions to the household do other household members provide? Has she tried to work with the creditors to pay down the debt? Would she be able to pay off the debt in 5 years?

If she does claim Bankruptcy, does her debt get wiped clean?

Assuming all of her debt is dischargeable debt, yes. As far as I know, debt incurred for necessary medical care is pretty much always going to be dischargeable.

If we got married, would it affect my credit?

Not unless you have joint debt. Even then, if you continue to pay on joint debt, her BK would not effect your credit.


Please do some reading on these forums, especially the stickies. You will learn a lot that can be applied to your gf's situation. Better yet, have her read these forums. She should also make appointments for free consultations with a couple of BK attorneys who can gather all necessary information to advise her on her best course of action.