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  • FIRST POST
    • Weggy
    • By Weggy 19th Nov 05, 10:20 AM
    • 463Posts
    • 98Thanks
    Weggy
    Full and final settlement help thread
    • #1
    • 19th Nov 05, 10:20 AM
    Full and final settlement help thread 19th Nov 05 at 10:20 AM
    Hi all

    Am currently trying to negotiate with debt collection agencies, to get them to accept a full and final settlement figure. Does anyone have any tips on persuading them to lower their demands?

    Thanks

    Last edited by MSE Archna; 21-06-2006 at 7:41 AM.
Page 3
  • Loopy_Laura
    Thanks for that. I think I may send my first letters later today.

    One is Debt Managers Ltd, passed to them by Next Directory and they have had the debt about a month. They sent me a letter the other day saying they would accept a discounted amount.

    The other is MCS Ltd, passed to them by HSBC CC, they have held it for about 2 weeks, only one letter from HSBC so far telling me it had been passed over.
    Have champagne tastes...but got a beer budget!!
  • Loopy_Laura
    Oh by the way Weggy, did you make your offers over the phone or by writing letters, and how long did it take you to settle on something?
    Have champagne tastes...but got a beer budget!!
    • Toto
    • By Toto 19th Jun 06, 4:15 PM
    • 6,446 Posts
    • 10,902 Thanks
    Toto
    What did you say in your letter? Did you explain where the money was coming from and say why it was a good deal for them? I want to make full and finals when I sell my house but if they know I have a business which, ok, got me in this mess, but is actually picking up and looking ok for the future they might think they would be better to hang on and wait.
  • Metropolitan Anthony
    For anyone who wants it, here is the standard f&f letter I found elsewhere on the web. I've adapted it a little to mention relatives, but have not sent it out yet. It's important to put "without prejudice" at the top of the letter but probably not worth sending it by registered post.

    The Loan Company
    Company House,
    Church Street,
    Newtown,
    Kent,
    R1 7HG

    WITHOUT PREJUDICE:

    Dear Sir/Madam

    Re: Card Account 1234567812345678

    I write with reference to the money which you are claiming on the above account.

    I can confirm that I am unable to offer to pay the money which I owe in full.

    A relative is prepared to offer me £xxxx. I want to offer this sum as an ex-gratia payment, in full and final settlement of the account. The offer from my relative will not be available forever and my relative will not make the payment unless the offer is accepted.

    This offer is made on the clear understanding that, if accepted, neither you nor any associate company will take any other action to enforce or pursue this debt in any way whatsoever and that I will be released for any liability. I also request that, if accepted, you will make an entry on a credit reference agency file relating to the above account as "satisfied" in full.

    Payment can be made within 14 days of receiving your written agreement of this offer and method of payment.

    I look forward to receiving your reply.

    Yours faithfully
    Last edited by Metropolitan Anthony; 19-06-2006 at 9:43 PM.
  • Metropolitan Anthony
    Are you making the official minimum repayments or have you entered into a much lower payment figure with them? If you're still making the 'official' repayment, then they wont accept a full and final settlement....
    by Weggy
    Weggy thank you for your guidance.

    I am making the official minimum repayments to all cards. Therefore to get things rolling I've decided to choose one lender next month and cut the minimum to "half minimum" and then "quarter minimum" the month after that. I'll cancel the DD and replace it with a new standing order that I can control. Finally, in month two or three, once they realise I'm behind, I will send the f&f offer letter and say I am unemployed.

    I suppose the problem with this approach is that you save 30-50% on what you owe by reaching f&f agreements with your lenders. However, you accumulate new "default notices" on your credit record with the accounts you settle with.

    But seeing as I already have 3 defaults, I've decided another 8 defaults won't damage my credit record any more than it is already damaged.

    Any comments welcome.
  • Loopy_Laura
    Thanks for that letter, didn't have a clue how to word it but that really helps.
    Have champagne tastes...but got a beer budget!!
    • Weggy
    • By Weggy 20th Jun 06, 9:20 AM
    • 463 Posts
    • 98 Thanks
    Weggy
    Weggy thank you for your guidance.

    I am making the official minimum repayments to all cards. Therefore to get things rolling I've decided to choose one lender next month and cut the minimum to "half minimum" and then "quarter minimum" the month after that. I'll cancel the DD and replace it with a new standing order that I can control. Finally, in month two or three, once they realise I'm behind, I will send the f&f offer letter and say I am unemployed.

    I suppose the problem with this approach is that you save 30-50% on what you owe by reaching f&f agreements with your lenders. However, you accumulate new "default notices" on your credit record with the accounts you settle with.

    But seeing as I already have 3 defaults, I've decided another 8 defaults won't damage my credit record any more than it is already damaged.

    Any comments welcome.
    by Metropolitan Anthony
    Probably not what you want to hear, but you're a long way from being able to negotiate a full and final settlement. You'll need to enter into a payment agreement with these companies and then keep to those agreements for many months. It took me nearly 5 years from getting the first default to clearing all the account with full and final settlements.

    You're correct what you say about your credit record. Mine is totally shot to pieces and it stays that way for 6 years from the date of default. I picked up about half a dozen defaults, and one CCJ. Thankfully, I'm now just under a year away from my record being cleared of all the defaults and the CCJ. But then if you're in such a mess with credit, the last thing you need for the next few years is more credit.....

    As for default notices - they cant issue another default when you settle. It's one default per account.... end of!
  • Loopy_Laura
    In relation to the letter above...should I mention my funds are coming from a bonus from work or by other means?

    Thanks. x
    Have champagne tastes...but got a beer budget!!
    • Weggy
    • By Weggy 20th Jun 06, 10:09 AM
    • 463 Posts
    • 98 Thanks
    Weggy
    What did you say in your letter? Did you explain where the money was coming from and say why it was a good deal for them? I want to make full and finals when I sell my house but if they know I have a business which, ok, got me in this mess, but is actually picking up and looking ok for the future they might think they would be better to hang on and wait.
    by Toto
    Didnt say where the funds were from in my letters. I think only one of them actually asked so I said they were from a relative, and wouldnt be available for ever.....
  • Loopy_Laura
    If the debt has been passed to a DCA, do you make your offers to them rather than your original creditor?

    Composing my letters while the boss is out...
    Have champagne tastes...but got a beer budget!!
    • Weggy
    • By Weggy 20th Jun 06, 2:33 PM
    • 463 Posts
    • 98 Thanks
    Weggy
    If the debt has been passed to a DCA, do you make your offers to them rather than your original creditor?

    Composing my letters while the boss is out...
    by Loopy_Laura
    All mine went through the DCA. Once they've been passed to DCA, you'll find that hardly any original creditors will even talk to you..... they'll tell you to contact the DCA.

    Also ask the DCA if they have bought the debt. If they have, they tend to have more scope to give you a bigger discount on the the full and final.
  • Loopy_Laura
    OK am putting my offer letters in the post today, have offered just under 30% on both. Fingers crossed!
    Have champagne tastes...but got a beer budget!!
    • Weggy
    • By Weggy 20th Jun 06, 3:43 PM
    • 463 Posts
    • 98 Thanks
    Weggy
    Good luck! Make sure you let us know how you get on....
  • MCBIRNIE25
    Got an interesting one over this.
    Was dealing with a creditor I absolutely loathe, to the point we have had some huge rows in the middle of the square I live in after they have knocked at obscene hours. Anyway, since becoming a DFW I thought i would negotiate a full and final offer to get rid of this scum bag!!!!!Anyway, we couldn't agree on an acceptable figure, i offered 30% he wanted 62%, so I have put a cheque in the post and popped in a letter AND ALSO WROTE ON THE CHEQUE that cashing this cheque constitutes accepting a full and final offer on the account and I see this account as settled. The cheque has been cashed... anyway, just taking legal advice on this now to see how it holds up.Expecting a call back from my legal advisor anytime now... Will keep you posted.
    • Toto
    • By Toto 20th Jun 06, 4:02 PM
    • 6,446 Posts
    • 10,902 Thanks
    Toto
    Hey good plan, I hope it works for you. If it does it's something I will think about doing. I am sure seeing a cheque in their grubby little hands adds an awful lot of weight to your f&f offer.

    Good luck!

    btw fancy spilling the beans on who the dca was?
  • MCBIRNIE25
    Haha, not yet, don't wanna curse my application. Believe me when i said there was near fisticuffs on more than 1 occassion. I also feel sorry for my poor neighbours seeing me berating a DCA person in my undertwear at 10pm lol.
    • Toto
    • By Toto 20th Jun 06, 4:48 PM
    • 6,446 Posts
    • 10,902 Thanks
    Toto
    If I were you neighbour you would have got a round of applause LOL

    Let us know how you get on with the legal issue, I wish you all the good luck in the world, hopefully you can now put this all in the past.
  • Metropolitan Anthony
    you're a long way from being able to negotiate a full and final settlement. You'll need to enter into a payment agreement with these companies and then keep to those agreements for many months.
    by Weggy
    I've only got experience of two f&f situations from back in December 2003, a goldfish card and a providian/monument card. These are now settled .

    By December 2003 I had entirely missed three months of repayments on the goldfish card. They defaulted me instantly and sold the debt to westcot. Westcot forced me to repay around 100% of the debt. The only concession from westcot was that the repayments were spread over the next 10 months. I made all these payments and got a "settled" letter from westcot.

    The reason I did not offer to settle for less with Westcot was partly inexperience, partly because I had no lump sum to offer but mainly because westcot insist on doing everything over the phone. It is very important to know your own weaknesses and strengths. I am very weak over the phone and I have no negotiating skills. They had me at a disadvantage. I am much more persuasive in writing.

    I had better fortune with Providian/Monument in December 2003. Again after three months of non payment to Providian my debt was sold to a DCA called Credit Solutions or something similar. One phone call to the DCA and they made me a f&f offer of 60% of the debt. I was very surprised and agreed to this, wrote the cheque and settled the debt. I was also lucky to avoid a default on my credit record.

    My point is that I might be in a position to settle more debts this way with some lenders within three or four months of non-payment. The differences this time are as follows:
    • I'm a little more experienced thanks to this site.
    • This time I do have funds to hand to make f&f offers to compliant lenders.
    • I'm planning on making precisely zero phone calls. I'll make all offers in writing.

    We'll see.
    It's no use saying, "We are doing our best." You have got to succeed in doing what is necessary. Winston Churchill
    • Toto
    • By Toto 20th Jun 06, 6:35 PM
    • 6,446 Posts
    • 10,902 Thanks
    Toto
    I had a letter from wescot today regarding the BOS loan. they said

    The creditor is prepared to assist you in clearing this debt by offering you the opportunity to make a reduced settlement on the outstanding balance on favourable terms.

    What should you do?

    To take advantage of this opportunity please contact 0870 *** ****

    This settlement offer is conditional on you contacting us within 10 days of the date of this letter. Please note this offer is available for a limited period only.

    I will write and reply, saying I would like the offer in writing etc and negotiate from there. My problem is I won't have the settlement money until the house sells and I can't say how long that will be, hopefully not too long, but you don't know.
    • Toto
    • By Toto 20th Jun 06, 6:48 PM
    • 6,446 Posts
    • 10,902 Thanks
    Toto
    I have drafted this reply... what do you think? Any laws dating back to the 70s with sub sections I should mention LOL

    Dear Sir/ Madam,

    I would be interested in discussing settlement terms with you regarding this debt but would prefer to keep all communication strictly in written format.

    I would therefore appreciate you forwarding me your settlement proposal terms in writing to ensure all discussion is properly documented.

    I would also appreciate it if you could give me the terms of payment in the proposal. Including the time frame in which you would expect the settlement to be made.

    Kind Regards

    Toto
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