Full and final settlement help thread

Jason_Bourne_2

Understand where you're coming from, I guess after 3 years or so I feel I just want an end to it is quickly as possible.

Hope you do alright out of it.

fatbelly

SgtRock wrote: »

Hi all. This is my first post,so be gentle with me and please answer in layman terms. I get very confused with financial talk/jargon.
Basically,my ever worsening financial situation hit ridiculous levels around May with combined loans/cards totalling around £30K. I had to do something(which I should have done far sooner),so I contacted Stepchange. I have been paying £155 per month
,since June.
However,I have recently inherited enough to pay off all of the above. My gut feeling is to pay these debts off,with F&F offers,but wouldn't know where to start?!
I could sure use some help...!

Hi SgtRock

Firstly have a read at this factsheet

Factsheet | Full & Final Settlement offers

There's a lot of advice there, and a standard letter. With around 26k of debt you may be able to save 13k with a bit of effort if you are organised. Their choice will be to continue with a 14-year plan or settle now.

You have done the right thing by depositing your lump sum with a bank unconnected to your debts. Incidentally you are not connected to Santander and their current accounts give 3% interest on up to 20k and you can have two

I recommend sticking with a debt management plan for at least six months before trying F&F so your timing is good too.

To answer some of your questions. Do this yourself. Do it in writing. Start at 25 or 30% and expect to negotiate upwards. The money is coming 'from a close relative.'

Nationwide often threaten court action through KPR but do not often take it. You'd be unlucky but if it happens you can pay off a ccj within 28 days and it does not get recorded.

Why are Barclaycard making weird demands if you are on a debt management plan? Do not phone them! At least not at this stage.

Ask more questions if you need to.

DMP1

Hi


I had the following


Santander £2500 settled for £650
Halifax £4700 settled £2950
Cabot £3800 settled for £2000


Santander and Halifax was negociated through my debt management plan and the debts are all 5 years old


Cabot would only offer my DMP a 15% discount and I asked the DMP to negociate with them for 6 months to try and get that increased


However after 6 months and the other two debts being settled Cabot still would only offer 15% which meant that I would be paying £3100 on a debt of £3800 which made no sense


So I sacked off the DMP and just rang cabot myself


I said I wanted to talk to them direct because after 5 years I just want this settled and they can either take £1 a month for 280 years or they can let me make a realistic offer on a debt they bought for about £300 and get it sorted


So I said I only had £2000 and that was my final offer and nothing else


The girl spoke to her manager and said 'we can offer you £2950 settlement'


I flat out said no that's ridiculous, why would I settle for that after 5 years, you need to go to the boss and ay its £2000 or a £1 a month and I just want to get it settled and I know you will make about £1700 on this debt so its in your best interests


2 mins later back she came saying yes £2000 is acceptable and that was that F&F settlement


Do not let them boss you about. Most debts you have will probably have been bought over by collection companies which will have bought them for next to nothing


Keep reminding them of that when you are making an offer and they will be keen to get a decent amount out of you without pushing their luck


Good luck

SgtRock

Hi Fat Belly,

Great username,though doubt it's much bigger than mine?! Anyway,thank you SO much for your reply,which has given me hope and a bit of a spring in my step since reading your comments upon waking up..

I do have a few questions,if I may? :

1) I was(past tense) going to contact Stepchange & tell them of my new situation and ask for their advice. I'm not so sure now. Would it be a wise move,or should I keep quiet for now? I mean,am I actually obliged to inform them or can I CHOOSE to continue paying the monthly £155 to them?

2) Do my creditors,& indeed Stepchange have any access to my bank account? If so,this would/could surely scupper any F+F offers I intend to write.

3) Very interesting to read about Santander's generous interest rate on current accounts. Had a little look online,& in addition it appears they pay cash back on some utility bills paid via direct debit,including council tax & mortgage!
But how many bank accounts are you allowed to hold,out of interest? Is it unlimited? I have 3. Two,I have already mentioned. Natwest with a healthy balance,Halifax which heavily into its overdraft albeit receiving monthly payments via Stepchange. I also hold a Nationwide basic account(just debit card) doing very little,with about a£2.00 balance only.
My slight concern is that I have already banked with Santander. Well,I closed the account at about the time they changed from Abbey. I had no financial problems with them at all. I even paid off 2 Abbey loans in full,& kept my account in good shape generally. I just fancied switching,& liked Halifax's cash back on their debit card(at the time),& if I'm honest was sick of talking to people abroad when phoning their customer services! Do you think they would take me back? I have only been with Natwest for about half a year,& am worried that they may want to know why I switched,& wish to do so again so soon. And I am also fearful they may ask loads of questions re loans,cards etc,and worried my poor credit rating may prevent me from re-opening an account with Santander?

Regards,SgtRock

fatbelly

SgtRock wrote: »

2) Do my creditors,& indeed Stepchange have any access to my bank account? If so,this would/could surely scupper any F+F offers I intend to write.

On this one, the answer's no. It's so important to have a bank account unconnected to your debts for that reason. They can only apply 'right of set off' across their own accounts.

Now whether Santander would have you back? You won't know until you try. Your existing debts may show as defaults and that may have an effect. Your past history with them may count for something.

Everyone's switching at the moment to get a better deal. There are articles on this site about the process if you look at banking/saving at the top of this page.

Regarding Stepchange, I'd just continue with the plan for the moment. It highlights the choice that you will be asking your creditors to make - small monthly payments for the next 14 years or a reduced settlement now!

System

I hope it's OK for me to also post here.....


I'm currently negotiating settlements for with 3 different creditors, 2 of which have agreed however the 3rd are still staying no/90% of debt.


I started at 30% and up it to 40% - the money is coming from others. I don't know how much they are able to go up to, but they've said they would really like to settle everything for us, so I want to get them/us the best deal I can.


The remaining debts are 2 personal loans for approx. £24k in total and were taken out with. These have been passed on to within the last month and they are being a lot tougher with their negotiations than the other agency and Bank were who we've just settled with! Perhaps, this is because we are currently paying monthly amounts which are only 20% less than the original monthly loan payments, though it will still take approx. 10 years to pay all back!


Anyway, I'm not sure how strong to word my next letter as obviously they won't have spent a great deal obtaining the debt as it's now 5 years old and though we really want to settle I don't want to offer more than they deserve (not that they deserve any... I wish would've written the debt off with us for what they paid for it!)...... So how should I word the next letter and how long should I leave before responding?


Many thanks

fatbelly

stejay wrote: »

I'm currently negotiating settlements for my partner and I's debts with 3 different creditors, 2 of which have agreed however the 3rd are still staying no/90% of debt.

I started at 30% and up it to 40% - the money is coming from my parents

The remaining debts are 2 personal loans for approx. £24k in total and were taken out with Northern Rock. These have been passed on to Marlin

So they're at 90%, you're at 40%. That's still quite a gap, and we want them to move down a bit.

There's a key here: https://forums.moneysavingexpert.com/discussion/4784561
where the op got a settlement at around 25% after doing a cca request, which Black Horse couldn't provide.

Though I do recommend making settlement offers in writing at least to start with.

Try a cca request with Marlin:

Factsheet | Getting information about your credit agreement

Jason_Bourne_2

Ok, letters all sent and 1 company has phoned me to offer a settlement figure of 80% which is a little more than I can afford if all companies pay the same %

They have said verbally that they would mark file as part settled but balance would be zero and no one will ever persue the debt. Calling them back in next few days with counter bid as 80% is a little too high.

I said I need the offer in writing, they said they would give me a receipt number if paid over the phone and a letter would follow. I take it this is not to be trusted and do not pay anything without the letter?

Thanks

fatbelly

Jason_Bourne wrote: »

I said I need the offer in writing, they said they would give me a receipt number if paid over the phone and a letter would follow. I take it this is not to be trusted and do not pay anything without the letter?

Thanks

That is correct!

Jason_Bourne_2

Cheers fatbelly