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When enrolled in a Debt Consolidation program, the company never makes payments directly to the creditor. The payments always come from the client’s personal savings account. Debt Consolidation companies are protecting their clients from having a specific comment stamped on the consumers credit report. If FH Financial made the payments for you, we would have to update your credit report with a comment that you are enrolled into a Debt Management Plan. If you have this mark placed on your credit report, you will have a bad credit score for 7 years or until this is removed from the credit bureaus.
Debt Consolidation is not a loan and it is not a monthly pay your bills service. We work with your creditors to negotiate a settlement to reduce your debt where you can afford to make your payments.
Each month you make your monthly payment according to your debt settlement payment plan. A portion of that goes to FH Financial and the rest of the payment goes to the client’s personal savings account. As the money accumulates in the savings account, the creditors begin to offer settlements to pay off the debt. As the debt negotiation process goes on, the client continues to make their monthly payment. Once FH Financial gets your settlement down to the best possible debt settlement, the client then approves the debt settlement agreement and the bill is paid off from the client’s savings account.
The savings account will always remain in your control the entire time you are enrolled in the debt consolidation program. Only you the client have the authority to make a payment to a creditor to pay off the bill.
You should never let a company control your debt settlement savings account! Companies that require they maintain your savings accounts are typically scams and you should not do business with them.
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