When considering filing for bankruptcy, you may wonder if it will clear your utility bills. Utility bills are some of the most common debts that people incur, and they can quickly add up if you fall behind on payments. In this blog post, we will explore whether bankruptcy can help clear your utility bills and what to expect during the process.
The short answer is yes, bankruptcy can clear utility bills in certain cases.
Chapter 7 Bankruptcy
In a Chapter 7 bankruptcy, utility bills are considered unsecured debts, which means they can be discharged or eliminated. However, keep in mind that some utility companies may require you to pay a deposit to begin services again after bankruptcy.
Chapter 13 Bankruptcy
In a Chapter 13 bankruptcy, utility bills can be included in your payment plan. This means that you can pay off your past-due balances over a period of three to five years while continuing to receive services. However, you will need to stay current on your utility bills after filing for bankruptcy to keep services active.
Another important consideration is that utility bills may be considered priority debts in bankruptcy. This means that they are given higher priority than other unsecured debts. For example, if you file for Chapter 7 bankruptcy and have a limited amount of money available to pay your debts, your priority debts will be paid off before your unsecured debts.
If you are behind on your utility bills and are considering bankruptcy, it’s important to note that bankruptcy will not prevent utility companies from shutting off your services. However, there are certain protections in place that can help.
The automatic stay, which goes into effect immediately after filing for bankruptcy, prohibits creditors from taking any action against you, including shutting off your utilities. This stay typically lasts for the duration of your bankruptcy case.
How Do I File for Bankruptcy with No Money?
Bankruptcy is a difficult process. It requires patience, resources, and money. However, if you are in financial dire straits and have no money to your name, filing for bankruptcy can be a lifesaver.
Here’s what you need to know.
Bankruptcy Chapter
The first step in filing for bankruptcy with no money is to determine which bankruptcy chapter is right for you. Chapter 7 is often the best choice for those with no money as it involves the liquidation of all assets to pay off debt. In this way, you can discharge all unsecured debts without having to make payments over a long period of time.
Filing Fees
Next, you will need to file a petition for bankruptcy with the local court. This requires a filing fee, but you may be eligible for a fee waiver if you can demonstrate your financial hardship. The waiver is also available if you have an income below 150% of the federal poverty line. If you qualify for the waiver, you can apply using the appropriate court forms.
Working with an attorney provides a valuable resource, but it can increase the cost of filing. But working with a professional can also save you money in the long run.
While you may feel like you should be able to handle the process on your own, it is essential to have legal representation. Having an attorney walk you through the process will provide you with confidence and ensure you don’t make any costly errors. If you cannot afford legal help, there are legal aid societies in every state that offer pro bono services to low-income clients.
While filing for bankruptcy is never ideal, it can be a necessary step towards a more stable financial future. If you’re considering bankruptcy but don’t have the money to pay for the process, don’t despair. With a little extra effort, you can figure out how to file for bankruptcy with no money. Keep in mind that working with a qualified bankruptcy attorney is always advisable and that the specific bankruptcy procedures might differ depending on the state you live in. We hope that this guide provides you with a good starting point.
