Using Bankruptcy to Keep the Lights On

When you’re behind on your utility bills, it can be a severely stressful situation. Odds are, that if your utilities are being shut off, this is just the tip of the financial issue iceberg for you. On a positive note, by filing bankruptcy, you can be protected from utility shut-off, including your gas, water, electricity, and telephone.

Afforded to consumers by the “automatic stay”, once you filed bankruptcy, the utility services company can’t refuse or disconnect your services, much in the same way that creditors must stop all collection attempts. This reprieve, however, is only temporary and you must show a good faith effort to pay what you owe and provide “adequate assurance” of payment within 20 days after filing for bankruptcy. Proof of “adequate assurance” is a monetary deposit, account co-signer, or other form of assurance that utilities company agrees upon.

Before resorting to this, you can contact the Utility Company directly to see if alternate payment plans can be arranged. For example, some utilities offer customers the ability to push back a pay date by a week or two. Other times, you can allow a month or maybe even two to go by before you actual face a shut-off. If you have already received a notice that your services will be shut off, time is of the essence. If you consult a Sacramento bankruptcy attorney and discover that bankruptcy is your best option, then an emergency bankruptcy may be needed to ensure that you don’t lose any services. This is a method of bankruptcy that allows your utilities to stay on, while you gather the necessary information needed in a bankruptcy filing.

Don’t delay in taking an account of your financial situation if you are facing a utility shut-off, home foreclosure, or vehicle repossession. Ignoring the issue will not help at all. Contact a local bankruptcy attorney to ensure you are making and educated decision about how to obtain debt relief.