Are your medical bills and past-due notices piling up on your table? You may be tempted to throw them all away but it won’t be the best solution. You can’t pretend that your debt doesn’t exist even if you think you can’t afford to pay it off.
About 61 percent of consumers with medical debt claimed they feel stress, while 49 percent lost sleep over medical bills, and 23 percent weren’t prepared to repay existing medical debt. Don’t give up on repaying this debt. Here is what happens if you fail to pay medical bills.
What Happens If You Don’t Pay Medical Bills?
You Will Feel Stressed
Of couse getting a $200 payday loan no credit check can be a suitable solution to cover your medical bills without a hard credit inquiry. But if you already have a mountain of medical debt you can’t deal with, you may be scared of phone calls and collection offices.
Some collection agencies have aggressive tactics to return the money unless you write letters begging them to stop these behaviors or find an attorney to protect you. You may want to offer a reasonable monthly payment and negotiate this arrangement with the doctor’s office or the hospital.
Having to request payday loans for this purpose also leads to additional stress. According to the research on Payday Lending in America, most borrowers utilize payday loans to finance ordinary living expenses over the course of months while the average borrower is indebted about five months of the year.
The research shows that the first time consumers took out a payday loan, 69 percent used it to cover utilities, rent, or credit card bills, while 16 percent used it as help with medical bills or auto repair.
The Bills May Go to Collections
You need to take immediate action if the billing department of the hospital threatens to send your bills to collections. Medical bills on your credit report will seriously damage your credit rating. You may need to work with the billing department of the doctor’s office or the hospital if you want to avoid your account being sent to the collections agency.
Your Credit Rating May Suffer
The health care provider might not send your account to collections. However, it doesn’t mean the outcome will be positive. The hospital may report missed or late payments to the credit reporting agencies such as Equifax, Experian, or TransUnion.
Do medical bills affect your credit? Yes, once this information appears on your credit report, it goes to the payment history category. This category accounts for 35 percent of your credit rating, so it may lower your score significantly.
You May Find a Suitable Solution
You should try your best to think about a settlement, a payment plan, or a type of arrangement between you and the doctor’s office. The sooner you work out a suitable solution, the more chances you will have to avoid going to the collections or getting your credit score lowered.
You may obtain a credit card with an introductory 0 percent APR for a long period. This option also depends on your credit rating, ability to repay the debt on time as well as other factors.
It’s Possible to Buy Extra Time
Did you know that credit reporting bureaus should wait 180 days before they put the past-due debt on your credit report? They count 180 days after they received information about your unpaid medical debt. In other words, you still have a grace period of six months to try to negotiate this debt and resolve it. Otherwise, it will come up on your credit report and damage your rating.
Is a Medical Loan Right for You?
Many people decide to take out a payday loan or a medical loan to finance their bills. It’s important for you to define if requesting a medical loan can be a beneficial decision in your situation. It is useful if:
You Can Afford Monthly Payments
Many loans can be repaid in monthly parts or installments. If you calculate the total sum of the loan and it can comfortably fit into your budget, you may withdraw this money. Make sure you understand the lending terms, and the APR, and get a decent interest rate.
You Consolidate Your Medical Debt
Some consumers have high-interest medical bills that want to consolidate. This decision will help you get a lower interest rate, manage your monthly loan payments, and repay the debt faster.
Don’t take out a medical loan if:
You Qualify For Special Programs And Grants
Consumers, who qualify for assistance from government programs, grants, and charity organizations, may not need to request a medical loan. Search for alternative solutions or ask for a hardship plan from your hospital before you decide to take out a loan.
Borrowers with poor and fair credit (the FICO score is lower than 689) may get a high APR from the creditor. As a result, you will have to pay more interest rates and the total sum of the loan may not be affordable for you. If you calculate the total amount and find it too expensive with the APRs over 36 percent, it’s better to look for other options.
To Sum Up
You can’t neglect your medical debt. If you have a pile of medical bills, you have to find a suitable way to get rid of them. Negotiating a hardship plan with your doctor’s office or taking out a medical loan may help you avoid stress connected with the unpleasant consequences of non-payment.
If you fail to pay your medical bills on time, your debt may go to collections while your credit score may suffer a lot. If you want to maintain good credit and protect your credit history, follow our tips and think of the most suitable solution tailored to your current financial situation.