If you need to prevent utility shut-off because you are behind on your bills, then read on.
Prevent Utility Shut-Off
A lot of my clients around this time of year are struggling to keep up with massive gas or electric bills. A majority of those have entered into payment plans to prevent utility shut-off, which is essentially where a person agrees to pay 1/12 of the overdue amount over a 12 month period. So, if you are behind $1,200 on your electric bill, you agree to pay $100/mo extra ($1,200/12 months) on top of your normal monthly payment.
These payment plans can get out of hand real quick – especially on a tight budget. Many times the only reason utilities are not shut off is due to the Cold Weather Rule, which is in effect from November 1 through March 31st.
How Bankruptcy Can Help Prevent Utility Shut-Off:
Let’s take Westar Energy as an example – and say you owe $800. When a bankruptcy is filed, a notice is sent out to Westar Energy. Westar will first apply any deposit on hand to the $800 balance. The remaining balance is immediately written off. Westar will then issue you a new account number with a ZERO dollar balance.
Your next bill from Westar will be Pro-Rated. Again, let’s go back to the prior example. Let’s say that you filed your bankruptcy exactly ½ ways through the billing cycle. That means that your next bill from Westar will be Pro-Rated by ½. So if your bill was going to be $200, you will actually receive a $100 bill.
Don’t Forget The Deposit
But wait, there’s more! You will also be required to pay the deposit over again. Westar usually gives 3-4 months to pay the deposit, and the deposit can be expected to be around $180+. So, in this example, your next bill will be 1/3 of $180 ($60) plus $100 = $160.
Nearly all of my clients are honest, hard working folks who want to pay back what they owe. Sometimes it just isn’t possible. No matter what they sacrifice, they will never get ahead. Sometimes Bankruptcy is the only way out from a never ending cycle of shut off notices and payment plans.
If you have questions about Prevent Utility Shut-Off, please give us a call at email us now.for a FREE Consultation over the phone, in person or you can