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Non-Bankruptcy Options to Help Manage Your Utility Bills

frustrated man looking at bills

Winter weather can bring skyrocketing utility bills. Families struggling to make ends meet might worry that their next heating or electric bill will push them over the edge into filing for bankruptcy. However, there are non-bankruptcy options available to help Michigan residents manage their utility bills and keep the lights on this winter.

Michigan Winters Mean High Utility Bills

Every year, cold winter weather creates an increased demand for electricity, natural gas and propane to heat Michigan homes. As furnaces and space heaters work to keep you comfortable, the meter is running. Families often face gas bills that double or even triple in the fall and winter months. That can put a strain on your budget and leave you looking for options.

A shutoff notice from a utility company is an emergency warning signal. In Michigan, utility companies must give you at least 10 days notice before disconnecting your service and they must try to contact you twice the day before to explain how you can avoid disconnection. For some, that shutoff notice leads to an emergency bankruptcy petition and a 20 day stay of any service disconnections under federal law. This can be an effective way of discharging past-due utility bills and other debts. However, if bankruptcy doesn’t make sense in your situation, there are other ways to keep the lights on and the heat running this winter.

Non-Bankruptcy Utility Bill Assistance for Low-Income Families

Depending on where you live, and which utility companies cover your home, you may have non-bankruptcy options available directly from the providers. Many Michigan utility companies, including Consumers Energy, DTE Energy and Michigan Gas Utilities have payment plans available to seniors, members of the military, and low-income households. Some utility companies also offer pricing options that smooth out the ups and downs of energy use over the year, so that your energy bills are more predictable and easier to budget for.

State Emergency Help with Utility Bills is Available

In addition to the companies’ individual programs, the State of Michigan also has systems in place to provide emergency help with utility bills. The Department of Health and Human Services manages a State Emergency Relief (SER) program to provide direct financial assistance to families facing extreme hardship. They can also connect families with non-profit organizations who can help in emergency situations (not ongoing budgeting issues) that threaten families’ health and safety including:

  • Paying heat and utility bills
  • Making emergency home repairs
  • Relocation assistance
  • Burial
  • Home ownership services

In addition, the Michigan Energy Assistance Program (MEAP) provides statewide energy assistance to low-income households. This program helps residents move toward self-sufficiency, and provides help with budgeting and income options as well as paying their energy bills.

Negotiating Past-Due Utility Bills

Even if you make too much money or otherwise don’t qualify for the company payment plans and state assistance programs, you may still be able to get relief from past-due utility bills without filing for bankruptcy. For example, a one-time situation -- such as a health emergency or COVID-19 layoff -- may have caused you to fall behind. While you may now be able to pay your current bills, your past-due balances are still growing due to interest and late fees. Just making minimum payments won’t help you resolve the situation, and will only create bigger credit problems for you as your debt-to-income ratio grows.

In these cases, it makes sense to speak with an attorney to discuss your non-bankruptcy options even before the utility companies take you to court to collect the debt. A bankruptcy lawyer may be able to help you negotiate with your creditors, including the utility companies, and enter a payment plan you can afford without needing to liquidate your assets or go through the formalities of a bankruptcy.

At John A. Steinberger & Associates, P.C., we know how winter weather can affect the family budget. We will work with you to avoid shut-offs, negotiate payment plans, and connect you with programs to help manage your bills going forward. We are a full-service bankruptcy law firm in Southeast MI. We serve debtors and families in Southfield, throughout Metro Detroit, and in the surrounding communities. Call us toll-free at (866) 690-2140 or contact us online to schedule a free initial consultation.

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