This depends on the status of your accounts. If your accounts are current, and payments are still being made, then it is very possible that late payment fees and interest will continue to accrue on your accounts until they are charged off (typically 120 – 210 days from the day of last payment). No matter what type of debt consolidation plan that is chosen, interest will always accrue when the accounts are kept in current or pre-charge off status. In most cases FH Financial will only negotiate on the principle balance of your accounts thus making all of the added frivolous charges irrelevant.
Even though you are making monthly payments towards your debt settlement plan, those payments are not distributed to the creditors on a monthly basis. If payments are made on a monthly basis, then the creditors will not agree to settle your accounts. That is the reason your monthly payment is deposited into a savings account to accumulate until there is enough money to settle the account. Each account is settled individually; typically the smallest balance will be settled first unless there is reason to pay off another creditor first.
The advantage to enrolling your debt into FH Financials Debt Settlement program is a 40-60% reduction in your debt. Even if you pay 6 months of interest, late fees, and over the limit fees, that will only add up to an extra couple of hundred dollars compared to the thousands of dollars that you will save with a Debt Settlement Plan.
Now if your accounts have already been charged off, then no more late fees or interest will be charged on your credit accounts. The only exception to this is in the case of judgments, if a judgment has been issued and allows for interest to continue accruing.
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