Bankruptcy Can Help with Delinquent Utilities

While most people are aware of the fact that bankruptcy can help eliminate or reduce debts such as credit cards, loans and medical bills they are nor sure whether bankruptcy can help address delinquent utilities. In fact it can. If you are able to file a Chapter 7 to eliminate unsecured debt, then any outstanding utility bills can be included and eliminated as well. Similarly, if you are paying a reduced amount to your unsecured creditors in a Chapter 13, the Utility Companies can be treated the same way. The only difference is since the Utility Companies such as electric and gas are required to provide future services, they are allowed to request a security deposit typically equal to approximately one and one half times your average payment. For example, if someone living in Southern New Jersey owed PSE & G $2,000 and a typical monthly bill is $100.00, that person would eliminate the $2000 debt and they would need to provide a deposit towards future use of $150.00. Keep in mind the deposit is your money that you can eventually get back.