Despite efforts to educate the public on its real benefits, there is still a stigma surrounding filing for bankruptcy. People on the brink of it may regard it as a failure, while those unaffected may look down on those who file, believing their financial difficulties to be the result of poor money management or spending beyond one’s means.

While these are possible reasons why people might file for bankruptcy, they are not the most common. In many cases, people experience financial hardship due to circumstances largely, if not entirely, beyond their control. Here are some of the major reasons why Americans end up filing for bankruptcy.

  1. Medical expenses

Approximately two-thirds of all bankruptcies relate to the cost of health care. Though more people have access to health insurance since the passage of the Affordable Care Act, the coverage provided is not always enough to fully address the costs of treating a severe injury or illness. As a result, obtaining the necessary medical care can increase patients’ debt to an unmanageable level.

  1. Divorce

Nearly one-quarter of all bankruptcies occur because of divorce. The division of assets is not always equal, which can put one spouse at a disadvantage. Furthermore, the cost of legal services alone may be enough to sink either or both ex-spouses into intractable debt.

  1. Foreclosure or unaffordable mortgage

There are many reasons why a mortgage may become unaffordable. Homeowners may lose their jobs or receive a cut in pay. Interest rates or property taxes may rise. Whatever the reason, the lender may foreclose on the mortgage if the borrower falls too far behind on payments.

Filing for bankruptcy puts a temporary hold on debt collection efforts, including foreclosure. Therefore, many homeowners may choose to file for bankruptcy in an effort to prevent lenders from taking away their homes. Depending on the circumstances, however, sometimes foreclosure efforts can recommence following the bankruptcy discharge.