Advice on Settling a Default

thesealeyboy

HI

I posted on here some time ago when I really thought it was the beginning of the end, but now, after guidance and advice from numerous people i'm finally getting to grips with things, for those of you that can remember and care I have finished paying off the outstanding finance on my car, 10 months after I wrote it off!

Anyway, the reason for my posting is that I received a letter from a debt collection agency whom I have been in contact with for some time. This all started ages ago where I fell so far behind with my credit card payments that evetually the cc company passed it to an agency. To be fair the agency have always been helpful, reasonable and easy to talk to, and I have to admit that they have possibly one of the best customer care teams I have ever come accross. The situation is this: I am currently paying £50 a month which is affordable for me and more than the minimum the agency wanted, so everyones happy. Currently I think I have about £600 left to pay off, so in prob a years time all will be done and dusted.

The letter they sent has offered me the chance to pay the outstanding balance in full with a 15% discount. This would then put me in a position where my default would be 'partially satisfied'. However if I was to decline their offer, and continue to pay until the full balance is paid my default would then be 'fully satisfied'.

Can anyone explain to me the idifference between partially and fully satisfied defaults and their impact on my credit rating/score/file? Is there a real advantage to me paying off early, or would the 'partially' settled default come back to haunt me in the future?

file_wizzard

A partially satisfied default has a far more negative impact than a “satisfied” one.

I would suggest that if they are willing to negotiate ( as it would appear they are) that you offer a FULL AND FINAL settlement offer of no more that the total outstanding MINUS 30% they will tell you that they cant do it in the first instance, however be firm but polite and you may be suprised at what they accept!!

At present they are just testing the water with you to see if you bite., from there perspective they want this cleared and off of their books ASAP, the longer it go’s on the more admin Ect it is for them, and hence less profit.

If you are in a financial position which allows you to make a FULL AND FINAL offer then I would suggest this is the best course of action.

file_wizzard

thesealeyboy wrote:

. To be fair the agency have always been helpful, reasonable and easy to talk to, and I have to admit that they have possibly one of the best customer care teams I have ever come accross.

Just as a matter of interest, who is it ? , you must have found one of the very few good ones out there !

thesealeyboy

file_wizzard wrote:

Just as a matter of interest, who is it ? , you must have found one of the very few good ones out there !

They're called BLS collections, who I found out are actually a part of Lloyds TSB, who incidentally are a part of More Than which is the credit card I screwed up on.

Once settled how long will this partial or fully settled flag stay against me?

thesealeyboy

file_wizzard wrote:

If you are in a financial position which allows you to make a FULL AND FINAL offer then I would suggest this is the best course of action.

So, just to check I have understood this right: (and in order)

My best option is to convince them to fully settle the debt now, and pay the balance with a decent discount.

Failing that I am better off continuing my payments until my balance is clear and then default becomes fully satisfied.

Pay them now with the 15% and have my default 'partially satisfied'. How long would the 'partially satisfied' bit remain?

file_wizzard

for 6 years from the date of the orginal defult.

But if you are in position to realistically get the "monkey off your back" and at a decent discount then this is the best way to deal with it.

P.S this is an "in house" agency so you may do well to get more than the 30% but this should certainly be the minimum you aim for.

Give them some sob story about having other creditors, and that if BLS dont want the FULL AND FINAL you are sure one of the others will snap it up....see how quickly they change their minds on what is "aceptable" !

Just make sure that any agreement letter either from ro to them specificly states FULL AND FINAL settlement, no arguments in the future then !

thesealeyboy

ok, thanks guys, will sit down this w/e and have a look at my situation, either way will report back on me progress!

Ta

J

thesealeyboy

Icdientally, I have just run off a Credit Report from Equifax, and there is no mention whatsoever on there of my More Than Card or BLS collections and the fact I have defaulted on payments? Can this be right?

file_wizzard

thesealeyboy wrote:

Icdientally, I have just run off a Credit Report from Equifax, and there is no mention whatsoever on there of my More Than Card or BLS collections and the fact I have defaulted on payments? Can this be right?

Yes, you will find that lloyds report to experian, best to check this also.

The following may also be of interest;

http://www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1129725802,83707,

thesealeyboy

:-) This credit report has paid for itself already, I mentioned before that I had paid off the outstanding finance on my old car, but I just noticed on my credit report that the finance company have me down for a current balance of just over £6000!!!!

I have just rung the finance company who has asked me to fax them a copy of the report which I have just done and I am awaiting their response.

I am in the process of getting a report from Experian to compliment my Equifax report, although they are insisting my address doesn't exist at the moment so I am having to send them proof of ID and a recent utility bill etc before they let me access my report! Tut.

J

file_wizzard

thesealeyboy wrote:

I am in the process of getting a report from Experian to compliment my Equifax report, although they are insisting my address doesn't exist at the moment so I am having to send them proof of ID and a recent utility bill etc before they let me access my report! Tut.

Is quite normal for Experian, they seem to be a lot stricter then Equifax or call credit on their ID checks.

This if course a good thing!, if not slightly frustrating when you want quick access to information !