Financial Implications of an Auto Accident

August 12, 2016

Financial Implications of an Auto Accident

financial costs of auto accidentAn automobile accident can bring about more than just health problems, as there can be financial implications as well. Many victims are faced with staggering medical bills at the same time they are forced to take time off from work to recover. All too often, those who visit a car accident lawyer wind up needing financial assistance, and here is some of the advice we give these people.

Advise your Creditors Early

We recommend letting your creditors know about your circumstances as soon as you become aware there may be a problem. If you are hospitalized following your accident, don’t wait until you are released to begin making phone calls. Likewise, if you must have surgery or take time off from work, get in touch with those you owe money to immediately. The sooner you contact your creditors, the greater the odds are that they will make favorable payment arrangements. In some cases, they may even agree to suspend payments temporarily.

Possible Relief

You should also look into possible sources of relief. For example, you may have credit disability insurance that would make a loan payment for you while you are disabled. Some loan companies may even allow you to skip a payment or two, provided you are not currently in arrears.

Contact your employer to find
out if you are eligible for short-term disability benefits. This type of benefit will allow you to draw a small amount while you are unable to work. While it isn’t a lot of money, it may be enough to help you stay current on some of your smaller bills. Churches and local charities might be willing to offer assistance with monthly expenses such as utilities or groceries as well.

After Receiving Collection Notices

Creditors can only extend a grace period so far. If you are out of work for an extended period, the odds are very high that your creditors will eventually lose patience and begin asking for money again. This normally happens at about the same time short-term disability benefits are exhausted.

What do you do when it seems you are backed into a corner financially, yet are still unable to pay?  In that case, you should leave the matter to one of our attorneys. Many times, we are able to convince creditors to hold off a little longer until a settlement is made. Some will agree to do so in exchange for a written agreement which states you will pay the debt in full from your settlement.

Bankruptcy as an Option

In the event we cannot reach an agreement with your creditors, you may need to file bankruptcy. This will provide you with immediate relief against collection efforts and wage garnishments on the day you file. In Arizona, a Chapter 7 petition will allow you to keep any property you acquire (aside from inheritances) after your filing date, As such, any settlement you later receive will be off limits. You would however lose non-exempt property, as it would be sold by the trustee and used to pay off your debts.

Medical bankruptcies are extremely common, as an estimated 1.7 million people experienced one in 2013. Should we feel that bankruptcy is in your best interest, we will be happy to refer you to an experienced Chapter 7 or Chapter 13 attorney.

Fee Free Services

When you partner with our law firm, one thing you do not have to worry about is coming up with legal fees. We work on a contingency basis and do not recover unless there is a settlement. If you or a loved one has been injured, please contact us at once, even if you have not yet fallen behind with your creditors.