08 Mar Bankruptcy, Utilities and The Poor
Someone calls a bankruptcy lawyer to find out if filing a case would help with past due utility bills. The technical answer and the practical one are not always the same.
In fact, this is a phone call I face with stunning regularity whenever the temperature dips below the freezing mark or rises to the triple digits. It comes as no surprise that many can’t afford their utility bills, especially in a time of such severely rising costs and economic turmoil.
David Yen, a colleague of mine from Chicago, clearly sees this arise as well. David writes over at Credit Slips about how many people file for bankruptcy to keep their utilities on during a long, cold winter (or a long, hot summer in the case of an over-worked air conditioner).
David aptly notes that filing for bankruptcy is not always the best option for people who are having problems paying their utility bills; in fact, some people may be able to avail themselves of the Low Income Home Energy Assistance Program (LIHEAP), local charities or payment plans worked out with the utility companies directly.
David laments the loss of one of Chicago’s programs whereby people could pay for heat based on a percentage of their income, and comments that this option has now been replaced by bankruptcy.
If you’re behind on your utility bills and are considering bankruptcy, it’s important to think about what else is going on. If you’ve got other bills that aren’t getting paid and need to file for bankruptcy even in the absence of the utility bill issues, you may be on the right track. That’s exactly what bankruptcy is designed to handle.
If, however, you’re looking at bankruptcy for the utility bills and nothing more, stop yourself. Take some time online and in talking with local agencies about alternatives and government programs. Call the utility company to see if payment plans exist to help you through the tough times.
By all means, consider bankruptcy – but only if it’s on the table for more than just those utility bills.
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