Christopher S. Mulvaney,

Attorney and Counselor-at-Law

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THIS WEBSITE INCLUDES GENERAL INFORMATION & THE OPINIONS OF CHRISTOPHER S. MULVANEY. IT IS INTENDED TO STIMULATE A BASIS FOR QUESTIONS RELATED TO YOUR PARTICULAR FACTUAL CIRCUMSTANCES — BEFORE YOU ACT.  THIS WEBSITE DOES NOT CONSTITUTE LEGAL ADVICE. IF YOU WANT LEGAL ADVICE, PLEASE MAKE A ZOOM APPOINTMENT TO SPEAK WITH ME.

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The use of email or this form for communication with MULVANEY LAW OFFICE, PLLC does not establish an Attorney-Client Relationship. If you don’t think I have responded, please check your spam folder. Time-sensitive information should not be sent through this Form or through email. Sensitive information can be uploaded to an encrypted Dropbox folder in your client file. Google Review Link Yelp Review Link

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Gonzaga University School of Law – Spokane, Washington – Class of 2002 – Cum Laude The Latin phrase “Deo patriae, scientiis, artibus” translates to “For God and country through sciences and arts”.  The initials A.M.D.G. on the seal of Gonzaga Law School stand for Ad Majorem Dei Gloriam, which is Latin for “For the Greater Glory of God” the Motto of the Society of Jesus (Jesuits): a Catholic religious order founded by St. Ignatius of Loyola.

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“Eternal vigilance is the price of liberty.”
– Wendell Phillips (1811-1884), abolitionist, orator and columnist for The Liberator, in a speech before the Massachusetts Antislavery Society in 1852.

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A good first step is to contact a Credit Counseling Agency to assist you in organizing and evaluating the facts of your particular situation. You may be eligible for a Debt Management Program in which all of your creditors agree to take a pro rata share of the monthly amount you pay and agree not to sue you as long as you keep making payments. This approach has a higher chance of success than attempting to settle with creditors one at a time.

In order to effectively settle a debt you have to have negotiating leverage, which comes from the ability and willingness to file for bankruptcy protection. How much leverage you have depends upon if you qualify for Chapter 7 which requires no payments to creditors or if you have to file Chapter 13 which requires payments for 3 years for below median income debtors and 5 years for above median income debtors.

1. Calculate your “Debt-to-Income Ratio”.  If over 35% consider bankruptcy since your chances of successfully settling with all of your creditors are poor. If under 35% consider a global settlement by offering a pro rata share of your payment amount or lump sum to all creditors. DO NOT ATTEMPT TO SETTLE WITH CREDITORS ONE AT A TIME – I have had many bankruptcy clients who wasted a lot of money doing so.
2.   Calculate the “Median Income for your Your Family Size”.  If your debt-to-income ratio is under 35% and you are eligible for Chapter 7, and willing to file if necessary, then you have strong negotiating leverage. Tell all creditors in a written cease and desist letter (NEVER TALK TO CREDITORS ON THE PHONE) that you contacted a bankruptcy lawyer, are eligible for Chapter 7, would prefer not to file, but will be forced to file if the creditor sues. Then wait. Time is on your side as a debtor. Settlement opportunities ripen with time – they cannot be rushed.
3. If you are not eligible for Chapter 7 and have to file Chapter 13, then let creditors know that if they sue you, you will be forced to file and they will receive some payment over 3 years or 5 years.
4. IF YOU ARE NOT WILLING TO FILE FOR BANKRUPTCY PROTECTION IF NEEDED THEN YOU HAVE NO NEGOTIATING LEVERAGE.

An excellent book about settlement theory is called Getting to Yes. One key concept is the BATNA (Best Alternative to a Negotiated Agreement). By knowing which Chapter you would be forced to file if a Writ of Garnishment is served after a Judgment has been entered against you, you know how much leverage you have, and whether your position is weak or strong.

The Means Test

To qualify for Chapter 7, your income must be below the median for your family size (in which case you don’t take the means test) or if your income is above the median for your family size you must pass the means test. Passing means having less than $100 per month in disposable income.

Median income:

If your average gross monthly income falls below the median for your family size, you do not have to take the means test.  If above the median, proceed to step two unless more than half of your total debt is business debt.  In that case you are exempt from the Means Test.

This website has a median income by family size chart for calculating bankruptcy eligibility.

Be aware that not all creditor’s counsel has settlement authority from their client. I have offered settlements to creditor’s counsel who said they would gladly accept, but their client won’t let them. Sometimes creditors need to write off the loss more than they need any payment from you. That is why I have had clients receive their partial payment checks back in the mail.

Bankruptcy is a last resort after all other options have failed. I have had a small number of clients whose families bailed them out and paid their debts once they told them they were going to have to file for bankruptcy protection. This is rare, but if you have such a family – be grateful for it.

Here is a link to some surprise medical billing information

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Washington State residents can meet with me in Zoom/DocuSign from anywhere in the world, and I can notarize their electronic signatures because I am a remote online notary.  Just email me an image of your photo ID.

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