And so the story goes…Your lifelong friend “Joe” survived a life threatening heart attack earlier this year. Joe is your average 51 year old male who enjoys tennis and playing with his first grandson. He always appeared healthy and happy, nobody saw this coming.

Joe was enjoying a beer with friends after playing in his weekly tennis match. It was only 90 minutes of doubles, not highly competitive, but something seemed a bit off that night. Minutes later, his doubles partner called 911 while Joe laid helpless in the tennis club’s lobby. EMS arrived and quickly transported Joe to the hospital where he received the best care available. 3 weeks, 2 surgical procedures, and 15 physical therapy sessions later, Joe returned home where he continued his rehab, including a visiting nurse. As time passed, Joe returned to health and eventually back to work, where he earns enough to support his family’s middle class lifestyle.

The medical bills began to arrive in the mail. Joe was grateful for his medical insurance coverage, but not all insurance coverages are the same. In the end, Joe’s medical insurance covered about 70% of all the medical bills related to his heart attack. But this is where his story took a turn for the worse. The remaining 30% of Joe’s medical bills amounted to over $40,000.00. Surely a hefty sum for any middle class family to repay. At first, the hospital and other medical providers offered payment plans, but Joe quickly found himself balancing his recent loss of income with both his living expenses (mortgage, food, etc.) and massive medical bills. There just wasn’t enough money to go around. Eventually, most of his medical bills went into collections and ultimately, one medical creditor filed a lawsuit against Joe. All of this stress culminated in a wage garnishment, specifically about 25% of Joe’s net paycheck. During these trying months, Joe’s had to use his credit cards to survive.

Life seemed like it was spiraling downward. Not only was a quarter of Joe’s paycheck being garnished, he was now about to face a home foreclosure. Joe felt overwhelmed and depressed, he didn’t know where to turn. He didn’t plan any of this. He didn’t make any bad financial choices that led him to this point. Shouldn’t there be a way for good people to recover from unexpected medical conditions?

After speaking with friends and reading many online articles, Joe decided to meet with a bankruptcy attorney. Joe’s parents had always had a negative viewpoint towards bankruptcy and Joe had his own preconceptions on the subject. The stigma of bankruptcy seemed to be front and center. Joe was concerned about the social, emotional, and financial ruins that others related with bankruptcy.

Bankruptcy and Social Stigma

Joe’s father always said that bankruptcy was a result of being irresponsible with money. Somehow this didn’t seem right, given Joe’s medical situation. Joe was also afraid that all his friends would know if he filed for bankruptcy relief. While bankruptcy filings are of public record, they are not easily obtained. Sure, one could drive to the Federal Courthouse and manually dig up the records, if they even knew of the filing and if they had enough free time on their hands. Actually, many social stigmas related to bankruptcy have melted away over time. Most local newspapers no longer list bankruptcy filings as they are becoming more commonplace. Did you know that an estimated 4,000 bankruptcy cases will be filed in the metro Toledo, Ohio area in 2019?

Bankruptcy and Emotional Stigma

Joe has always been an independent man, paying his own way through school and never missing a mortgage payment. Somehow, bankruptcy felt like a handout or other type of charity? There was a sense of guilt and embarrassment growing within Joe’s mind. Sure, nobody wakes up in the morning and says “today, I will file bankruptcy.” In most cases, something out of a person’s control happened to them, leading to an eventual bankruptcy filing. Common examples of unplanned financial disasters are medical emergencies, job loss, home foreclosure, and divorce. Surely nobody planned for any of these. While the emotional aspects of bankruptcy can feel real, many debtors soon discover relief and freedom from the handcuffs of insurmountable debt. Feelings are internal and take time to work through.

Bankruptcy and Financial Stigma

Joe was under the impression that once you file bankruptcy, you won’t be able to buy a car or home for the next 10 years. It’s not like this news ever came from a bankruptcy attorney, rather it’s simply one of several financial stigmas associated with bankruptcy. Knowledge is truly power and the more you learn about bankruptcy relief, you may discover that many of the financial stigmas are no longer true. Yes, your credit score will suffer initially and some car dealers will charge you a foolishly high interest rate in the early days following your bankruptcy. But time passes and many debtors are able to purchase a car and eventually a home. Just like both the social and emotional stigmas of bankruptcy, the financial stigmas also pass with time. Talk to an experienced bankruptcy lawyer to get the facts, not the rumors.

…Several years have passed since Joe’s heart attack. Joe’s home is nearly paid off now and he has been able to put money into savings and enjoy life again. He is so thankful that he filed for bankruptcy relief. As a fleeting thought, Joe remembered this…Had he not filed for bankruptcy relief back then, he would still have about 3 more years of debt payments on medical bills.