my mom was contacted by an attorney who is representing a creditor she owes. She worked out a payment plan with the attorney for a lump sum down payment and a set monthly amount, she contacted the attorney recently to see how much longer the payments were necessary. At which time she was told by the attorney that the lump sum and payment arrangement had a 10% per month interest charge associated with it, so at the end of the payment contract she will have paid more than $1400 more than the account was to start. Is this the norm? Can they charge 1200% interest a year?
1 Answer from Attorneys
You mean that's 120% interest a year (10% per month). Even at that, it does seem excessive.