How to Consolidate Medical Bills

Consolidate medical bills arising from medication, treatment and stays in hospital. The cost of medical assistance has risen dramatically in America. According to Harvard Medical School, it was a contributing factor in 62% of all bankruptcies cases in 2007. This isn't only because people lack insurance and have pre-existing medical conditions, it is also because providers are incorporating clauses to avoid paying-out.

Ways to Consolidate Medical Bills

Those seeking a way to deal with past due medical bills have a number of options, other than bankruptcy, to resolve their financial difficulties. The best debt relief solutions include debt settlement programs, Debt Management Plans or a loan to consolidate debt. The right option will depend heavily on your current personal circumstances. The last thing you want to do is enter a debt solution that only serves to exacerbate problems further down-the-line.

The Right Way to Consolidate Medical Bills

The debt relief solution you choose to deal with past due medical bills will be dictated by a number of social factors. These include your credit score rating, the amount you owe to creditors and the amount of disposable income you are realistically able to contribute to a repayment plan each month.

Debt Consolidation Loans

Your FICO credit score rating is the biggest contributing factor to whether consolidating debt with a loan is the best debt relief solution. Individuals with an adverse credit history will find that the cost of borrowing is higher. They will also discover that there are few lenders prepared to offer financing.

Prosper loans may be able to offer an unsecured loan for debt consolidation. They are a peer-to-peer lender; this means that people lend to people. You will be given a chance to explain why you need to borrow money which may improve your chance of securing finance for any past due medical bills. The maximum loan is $25,000 and rate of interest is likely to be upwards of 20%.

Those looking for a better borrowing rate may be able to get a homeowner or HELOC loan. The provision of collateral means that larger loans are possible. Whilst this can be helpful in terms of consolidating larger medical debts, it is important to think carefully before turning unsecured into secured debt.

Debt Management Plans

This is the best debt relief solution for someone who has a number of small debts. It won't involve any of the debt being written-off, but it may mean that interest and further charges are frozen. Under a Debt Management Plan, any money is re-paid at a rate that is affordable to you. The only negative is that it can take a long time to fully clear the amount you owe.

Debt Settlement Program

A professional negotiator will work with creditors to arrange a reduction of up to 50% of the amount owed. You will then make payment to an intermediary for a period of 12 to 36 months. This is the best debt relief solution for dealing with larger debts. It is the most effective bankruptcy alternative for those who can afford to offer creditors a payment each month.

There are a number of ways to consolidate medical bills, but it is necessary to invest time and energy into determining the most effective debt solution. Always talk to a qualified debt counselor before proceeding.

Disclaimer: This article in no way attempts to provide legal, financial or tax advice. One should consult a licensed attorney, tax advisor, or other qualified financial professional before proceeding.