Lump Sum Payment To Clear Credit Card...What Should I Offer?

carlywarly82

Hi all,

I've been fortunate and have recently come into some money. I read somewhere that you can end up paying less than the total of what you owe if you offer to make a lump sum payment. Does anyone know if this is true? And what do you think I should offer? How do I go about it? Any advice would be greatly appreciated!

I have a balance with Virgin CC which is approx £6400 and one with Mint which is approx £5100 :eek:

x

NickX

carlywarly82 wrote: »

Does anyone know if this is true? And what do you think I should offer? How do I go about it?

Well it is true, it is known as a "Full and Final" settlement where the creditor agrees to take less than that is owed by way of clearing the debt in full.

However, for them to accept this you need to give them the impression that they will struggle to collect the debt in full. This means consistently paying less than the minimum required, or missing payments altogether, or going onto a debt management plan with them.

If they then suspect that there is a possibility of bankruptcy or IVA then they may deem it safer to take what they can and write the rest off.

I have heard "full and final" settlement figures of anywhere between 30% and 80% of the actual amount owed depending upon the circumstances.

Bear in mind that if you go down this route, your credit rating won't be left in a very good state.

carlywarly82

Thanks for your advice Nick. I have been struggling with the debt of late, had a few missed payments and gone over credit limits etc. I had written to them about being in a financial pickle. So will they take this into account if I make them an offer do you think?!

NickX

carlywarly82 wrote: »

I have been struggling with the debt of late, had a few missed payments and gone over credit limits etc. I had written to them about being in a financial pickle. So will they take this into account if I make them an offer do you think?!

It will be taken into account definitely.

Whether its enough to get them to accept a "full and final" settlement is another story.

No harm in writing to them with an offer though. Just stress that this is for a Full and Final Settlement only. Otherwise they will take the money and then claim that you still owe them the difference.

Also make sure that you have a letter from them clearly accepting the full and final settlement before you actually send them the money.

Good Luck.

Tiddlywinks

If you can afford to pay why do you think you deserve a reduction in your bill? You borrowed and spent the money so shouldn't you pay back what you owe?

tictax

How much money have you come into?

Unless you are in serious arrears ie 4 months + I don't see why the companies should let you pay less to pay off your bill. You did spend the money after all.

MABLE

Tiddlywinks wrote: »

If you can afford to pay why do you think you deserve a reduction in your bill? You borrowed and spent the money so shouldn't you pay back what you owe?

No thats was how things you use to be.

tictax

MABLE wrote: »

No thats was how things you use to be.

Yes until people started to not see defaulting on their debts as a bad thing.

I agree that it is better for banks to get something rather than nothing back where there is serious arrears but only where this is the only viable option.

MABLE

carlywarly82 wrote: »

Hi all,

I've been fortunate and have recently come into some money. (enough to pay off the balances on my Credit Cards. :j ) I read somewhere that you can end up paying less than the total of what you owe if you offer to make a lump sum payment. Does anyone know if this is true? And what do you think I should offer? How do I go about it? Any advice would be greatly appreciated!

I have a balance with Virgin CC which is approx £6400 and one with Mint which is approx £5100 :eek:

x

It would be very helpful to all of us if you could arrange to pay the full amount off. The reason I say this because of people like yourself the majority of people on here are being hit with high APR;s. (interest charges).

The reason for that is to compensate for people who borrow to their limit with little intention of paying the full amount back.

exel1966

carlywarly82 wrote: »

Hi all,

I've been fortunate and have recently come into some money. (enough to pay off the balances on my Credit Cards. :j ) I read somewhere that you can end up paying less than the total of what you owe if you offer to make a lump sum payment. Does anyone know if this is true? And what do you think I should offer? How do I go about it? Any advice would be greatly appreciated!

I have a balance with Virgin CC which is approx £6400 and one with Mint which is approx £5100 :eek:

x

It has to be said, If you spent it and you have the money to repay it, then do the right thing and repay in FULL. Don't shirk your responsibility to do so. Just think of the self-satisfaction you'll have inside knowing that you've overcome these major debts.

In_a_Mess_3

I have been lent some money by my husbands uncle to pay off my credit cards, it is an open ended loan and we don't need to pay him back until we are sorted out. :T

But, I have called all my creditors to get the balance of the accounts to pay them off in full, it never once occurred to me to ask how much they would accept.

I spent it and can now pay it back and hopefully go some way to repairing my credit rating, surely that's the best way to go???