Negotiate With Credit Card Companies

deb5376

Am I Being Realistic ??
Have a debt problem of £ 23k across 5 cards. Two cards hold the biggest debt of around £ 15k. I have negoiated with these cards a repayment plan for the immediate future. They have a breakdown of my income/outcome and have been working with me thus far. I have spoken to a family member about my problems and they may be willing to lend me a lump some of money toward paying off a chunk of this debt. I am wondering if i could approach these 2 cards and ask if they would be willing to accept a reduced settlement figure on the balance owing. Has anyone any experiance of this. Any advise would be helpful. One question is if they did accept this and advised a settlement figure should i accept there first offer or could i ask then to reducew further. What should i expect and how far can i push this.
Thanks In Advance.

Robert_Sterling_3

I noticed that the above post had had more than 30 viewings but no replies so I have nudged it back up to the top.

frepol

I don't think that you are going to get the balance down - especially if you haven't actually defaulted. Full and final settlement is more commonly used by Debt Collection Agencies who have already bought the debt from the company at a reduced price and who then offer you a discount at a level where they can still make a profit! However, you can't guarantee this, although it is usually worth asking!

Have you managed to get interest and charges frozen? If not, you're debt is just going to grow and grow and on a debt of £23K you will probably never get it paid off. Eventually, the credit card companies will probably default on you anyway which means that you will be throwing money away on covering a fraction of the interest charges when it could be passed to a Debt Collection Agency now and interest etc. would stop and you would have a balance to work on. You could then negotiate with the DCA on a path that will get the debt cleared - perhaps even possibly a full and final settlement. However, you are still probably looking at paying at least £15K and possibly £23K.

Why not post some more details of your situation. Are you temporarily unemployed, homeowner etc. Perhaps your best option for the future may be to declare yourself bankrupt - especially if you are not a homeowner and don't have an occupation where bankrupts are restricted.

Jonni2bad

I don't think you are being unrealistic about reducing the overall debt, it certainly worked for me.

I had not defaulted on my credit cards, but had been paying reduced sums for a period of time. Once I had sold my house I decided to use the profit to pay off the highest APR debts.

A previous employer had told me that he had offered to pay 40% of his debts (although I'm not sure if he had defaulted) so I used this as a starting point, being quite prepared to settle at around 60%. I wrote to each company, outlining where the money had come from, and that in order to settle my debts, I would be offering a percentage of the available cash to each and pretended this worked out at the magical 40%.

None accepted this, but began to discuss what they could accept, starting at about 80%. From there on, it was just a case of haggling. Stick to your guns, saying that if you can't reach agreement with any of them, then there is no point in using the money to pay off debts, and that you must be fair in distributing the funds amongst all your creditors.

About a month later I had settled 3 credit cards and a personal loan, at an average of 56% of the overall debt.

Quite a result, although I'm sure I could have held out for even more, but just wanted rid of the worst of the debts. This process left me with enough money for the deposit on our new house, so I was a happy bunny!!

So, in short, give it a try, start low because they start high, and try to keep in mind a figure that you will be happy to accept. Good luck...