Do you always get a default if you F&F?

lookingforthelight

I am making reduced payments to numerous CC's over the last year and presume my credit file would have late payments all over it but possibly no defaults yet.

If I am able to make F&Finals will I definitely then get defaults on my credit file?

Should I wait to get defaults before making F&F offers or am I going get defaults anyway with my reduced payment plan.

If I am going to get defaults anyway I would rather they were put on asap and get that 6 year wait started.

Thanks

lvm

I'm not too sure about the default thing but I would imagine if all you have is late payments and no deafults, the original creditor would still be pursueing your debt and won't have sold to DCA. I this is the case, I wouldn't imagine them giving you a great deal on F&F settlements. Although if you have been paying reduced payment for a year, that's better than just a couple of months.

If you weren't too bothered about getting defaults on your file (although I'd certainly recommend avoiding it!) then you should just stop paying anything to your credit cards, wait until your debt has been sold on to DCAs and about a year later, offer F&F. Very long winded and wrecks your credit file so I really wouldn't advise but it's always an option!

Tixy

I would check your credit files first to see what they show rather than just assuming there are no defaults.

There is probably no one rule for each creditor, some might accept a reduced F&F and then enter a default and partial settlement, another could accept it and enter as settled.
I have seen instances where people have an arrangement to pay marked and continue to make reduced payments for years and never get defaulted. Equally others will show an arrangement to pay for 2-3years and then default you after that, increasing how long it will affect your credit file.

You are certainly more likely to get better F&Fs after you have defaulted, and better still once debts have been sold to 3rd party collectors.

That said if you don't yet have defaults and are in a position to make F&Fs and to negotiate to ensure a default is not added personally I would go for that option - although I suspect you won't get much of a discount off the actual balance.