Consumer Law: In Conjunction/Lieu of Bankruptcy

Consumer Law deals with issues arising from retail transactions and purchases.  Most typically it arises when debt (credit card debt, medical debt, loan debt) begins to overpower people and they begin to realize that they need another option.  Perhaps they do not qualify for Bankruptcy or maybe they do not want to file Bankruptcy.  But, but if they do not do anything at all their creditors are going to come after them.  That is where either Consumer Law or Debt Consolidation come in.

Consumer Law:

Consumer Law is the practice or art of working with Creditors before the filing of a Bankruptcy to see if they will negotiate the amount of debt which is owed to them or accept a different payment amount from the person.  This process is typically undertaken by an attorney whom has experience in contacting creditors, explaining the raw facts to them quickly, and then attempting to negotiate a settlement with the creditor on behalf of the debtor.  All of this takes place in the attorney’s office with the debtor sitting nearby and giving permission for the creditor to speak with the attorney

Debt Consolidation:

Debt consolidation is where an experienced attorney sits down with you and analyzes all of your debt (credit cards, medical debt, student loans, consumer loans, mortgages, HELOC, etc.) and they then put together a consolidation plan where you are able to:

(1) Consolidate certain types of debt together

(2) Have fewer monthly payments

(3) Have less monthly expenses in required minimum payments


Less monthly expense means having more money available to pay off existing debt quicker.


For example: Jan and Steve have 5 Monthly Bills as follows:

Card Min. Pay Total Owed Max Credit
Discover $135.00 $3,200.00 $5,000.00
CHASE $200.00 $2,800.00 $6,000.00
Capital One $75.00 $800.00 $2,000.00
Medical $150.00 $1,000.00 N/A
Home Depot $75.00 $850.00 $3,000.00
TOTALS $635.00 $8,650.00


AFTER debt consolidation, monthly expenses are as follows:

Card Min. Pay Total Owed Max Credit
CHASE $275.00* $6,000.00 $6,000.00
Capital One $125.00* $1,650.00 $2,000.00
Medical $150.00 $1,000.00 N/A
TOTALS $550.00 $8,650.00




*Notice that while the CHASE payment actually increased by $75.00 and the Capital One payment increased by $50.00 a month, that the overall monthly payments actually decreased by $85.00 monthly because two payments were eliminated (Discover and Home Depot).  Thus, even though there was a slight increase in Chase and Capital One payments due to a higher balance owed, it still allowed the overall payments to decrease.

Therefore, after Debt consolidation, Jan and Steve have an extra $85.00 monthly to put towards their outstanding debt. It should be applied as follows:

First to the Medical Debt so that their monthly payment which they are making is $235.00 instead of $150.00. In 5 months the medical debt will be paid off.

Next Jan and Steve can add the $235.00 to the $125.00 and begin making $360.00 monthly payments to Capital One. In 3 more months Capital One will be paid off.

Finally Jan and Steve can add the $360.00 to the $275.00 and begin making $635.00 monthly payments to Chase Bank. In 6 months Chase would be paid off.


Was Bankruptcy the right choice for Jan and Steve?  No, and it may not be the right choice for you either.  Using the same money Jan and Steve paid off their debt in 14 months.  This same strategy can often be applied in many cases when people think that Bankruptcy is the only answer.


Attorney Brendon R. Rogers always offers a free consultation to clients regarding Consumer Law, Debt Consolidation, and Bankruptcy.  The meeting typically lasts about 30 minutes and when the meeting is finished you will understand which option is right for you.  In preparation for the meeting, please bring a 1 page summary of all of your debt.  Call today and schedule your FREE consultation.