On a DMP with StepChange - would I be allowed to try to get f&f settlements ?
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so_very_confused wrote: »The common theme throughout these posts is that Stepchange will always want to redistribute equally, however in passing I happened to mention that one of my smaller creditors bout 690 offered fnf for 500 and that my brother might be up to paying this (not really!) The person I was talking to seemed impressed and said go for it! Did not accept as I believe when the time is right can get it for much less, but interesting resoponse from SC?
As David has said (always so wise!) Anything (legal) that gets you out of debt faster is a good thing. As wonderful as SC are their aim is to get rid of us as customers
Yes, it's morally right to act fairly to everyone involved but you are making an offer not forcing them to do anything.
I don't think it's our place to decide what's fair in regard to the 50% now vs 100% over x years. It's their choice to accept the offer and in many cases F&Fs are made at a point where a company is fully aware that they may have to wait years or perhaps never recover the full amount. The simple fact is something is better than nothing and in a lot of cases it is ultimately cheaper in regards to resources to accept the F&F - their agents that call for payment or apply the payment to the account or adjust a payment plan don't work for free!
For example if you take 36 months to pay off a £360 debt a one off payment of £180 saves them the cost of those resources for the following 35 months with regard to this one account and they can direct those resources towards other tasks. For an in house debt it makes perfect sense if you believe this is a bad debt. For a DCA that perhaps paid £36 to the original creditor it's an instant £144 for 35 months saved work.
Yes, both are going to try to maximise the amount they receive from you but in relation to bad debt you both win. They don't have to work, you get debt free quicker.
Kate xLBM 17th Oct13 - SC DMP - DFD 10th Feb 2018
paid pre-DMP £6146
paid with DMP £2275 F&F's £700 (£450 discount) £1,000 (£1,498.22 discount) £ 700 (489.62 discount) Total £9725
Current debt to repay £3,503.13 taking one day at a time0 -
If it helps, I've been able to get a few F&F's for some small/mid size debts although I was about a year into my plan (give or take a month or two).
When I contacted SC for advice they advised that if a "friend or relative" gave you some money to help out then it can be used however you like but keep them informed and keep your plan updated so they know that a "friend or relative" have given you the money to repay the debt and that you have not incurred additional debt in obtaining the funds...
They also went on to tell me that in some cases where the loss of a debt has been noticed, explaining that their monthly payment has gone up tends to smooth out any 'wrinkles'
MB0 -
Thanks guys for your advice. I guess the only other thing on my mind is which looks worse - payment in full over time, or early settlement at a discount?
I guess at some point in the future I will want a mortgage or something - is this something to think of?
Or are both options so trashing one credit score anyway that that's like asking if you'd rather have a slap in the face or a kick in the ****?~~I am debt free~~0 -
If you are on a DMP you want early defaults and they're kind of inevitable. They'll drop off your credit file 6 years after registered regardless of what the settled/partial status is.
If you have A (arrangement to pay) markers these are more difficult as I believe they drop off 6 years after you have paid.
If you are on a DMP your credit file is likely to be pretty rubbish anyway. Plus, if you have the kind of debt problem that requires a DMP I think it's safe to say you don't have a deposit saved either.
Using myself as an example the plan is:
1. Get the debt paid as fast as possible (using F&F's if poss)
2. Save a deposit (circa £10-15k)
The DMP route is necessary for me because I don't currently have the means to service the debt. Credit file has floated off up the Creek for the next 6 years (I have 2 defaulted accounts) so a mortgage isn't going to happen before 2020. BUT (and it's a happy "but") if I can get the debt cleared sooner I can use the time waiting for the credit file to heal to save that deposit.
Not nearly as doom and gloom as it sounds. My DFD has already dropped from 20 YEARS to 79 months and when my PPI refund comes through another 24ish months will come off without considering the added "bonus" of F&F's being accepted. There's also the potential to increase income and further reduce remaining debt. So whilst I won't be buying a house this decade the potential to bring the "property purchase date" forward is a great incentive and getting closer all the time.
Personally I try not to look that far ahead. I focus on the here and now, having my focus on the future too much got me into this mess - I didn't take care of the present. Tackle one issue at a time, from your posts it seems you have 3 goals; debt freedom, credit file health, home purchase. Realistically that's the order they'll happen in too.
Kate xLBM 17th Oct13 - SC DMP - DFD 10th Feb 2018
paid pre-DMP £6146 paid with DMP £2275 F&F's £700 (£450 discount) £1,000 (£1,498.22 discount) £ 700 (489.62 discount) Total £9725
Current debt to repay £3,503.13 taking one day at a time0 -
So I was not talking to a rogue SC advisor then!Monkeyballs wrote: »If it helps, I've been able to get a few F&F's for some small/mid size debts although I was about a year into my plan (give or take a month or two).
When I contacted SC for advice they advised that if a "friend or relative" gave you some money to help out then it can be used however you like but keep them informed and keep your plan updated so they know that a "friend or relative" have given you the money to repay the debt and that you have not incurred additional debt in obtaining the funds...
They also went on to tell me that in some cases where the loss of a debt has been noticed, explaining that their monthly payment has gone up tends to smooth out any 'wrinkles'
MBSCP # 034
The £1000 emergency fund #590 -
so_very_confused wrote: »So I was not talking to a rogue SC advisor then!
LOL, nope I guess that at the end of the day SC are a debt charity and want the best for their consumers... As I have said many times before, I can't fault them 
MB0
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