Full & Final Settlement - No Response- what next?

saffronella

I received a small amount of cash from the Inland Revenue as a tax rebate.
I have used the money to send a cheque to a debt collection company in full and final settlement of my husband's credit card debt (we have seperate cards, bank accounts etc).

My husband sent the debt company a letter explaining he was struggling to pay the debt and had been for the last 3+ years, of which they were aware. He offered them a sum which equalled 12p in the pound, and we also wrote "in full and final settlement" on the cheque that we enclosed.

I sent the cheque on 25/11. I am checking my bank account daily but as yet it has not been cashed through my account and my husband has had
no response by either phone or letter from the debt management company.
I assume that they are NOT going to cash my cheque as if they do, it means they accept the payment as full and final settlement of my husband's debt.

Should I:-

a) Put a stop on the cheque and use the money to pay off other debts. My husband will carry on paying the monthly standing order (not DD) of £75 to the debt company. Does he need to tell the debt company that I've stopped the cheque?
Also this means that it is not a true full and final settlement if he's still paying the S.O. each month, but if he doesn't pay the S.O. then he would be in breach of the payment contract, and that would cause further trouble?

b) Put a stop on the cheque and then send another cheque (by recorded delivery this time - Doh!) I would obviously have to tell them that the original cheque has been stopped and this is a fresh cheque..?

c) Leave the cheque with them until the cheque is out of date to be cashed, (6 months?) but my hubby will carry on paying the monthly standing order to the debt company. I will also keep the amount of money the cheque is worth in the bank case they do cash it. Again, defeats the purpose of a full and final settlement?

c) Get my husband to contact them by phone or letter, to see if they are going to accept the cheque in full and final settlement, though I assume they'll say they've not received it (I foolishly did not send it via recorded delivery) even though I suspect they have. Or, they will try and persuade my hubby to pay a higher amount in F&F settlement.


I can't contact them, as it is my husband's debt account, so I am in a complete quandry as to what to do next
Has this happened to anyone else when they have sent a cheque in F&FS.
Thanks for your help.
Saffronella

Entrepreneur_en_faillite

Was the F&F agreed by the debt company?

saffronella

We were instructed by the Bankruptcy Association not to contact the company beforehand as they would obviously say No. But to send a letter explaining that we're struggling (which they already know as the debt is over 3 years old) and to enclose a cheque in F&FS. The ball is then in their court, so to speak.
The debt company haven't responded at all as yet, so I don't know whether they've agreed to it or not.

Entrepreneur_en_faillite

Ok

My experience is that debt collectors will take some time to cash a cheque. My gut feeling is to cancel the cheque, and reissue another by recorded delivery, at least that way you would know whether they had received it or not. The only problem with that is you might give them the hump if they have already started to process the cheque.

Sorry I can't be of much more help.

saffronella

Would you advise contacting them to see if they have started to process the cheque, The next payment by S.O. will go out on 23 Dec. So we'll need to know before that to cancel the S.O.
Even if I do cancel the cheque and send another, there's still no guarantee they'll cash it staightaway, so we'll be in the same position, not knowing whether to cancel the S.O or not.
Tricky one isn't it.

J_P_S

the best advice imo would be to contact the company and find out whats going on, they may never have rceieved the cheque though, in which case you may be doing what you were advised not to do.

maybe best to resend it but do it recorded this time so you know they get it.

ask them to contact you to confirm receipt of the letter whether or not they are going to accept the offer. at least that way you will know where you stand.

becky004

I am in the same sort of predicament. Rang equidebt and offered 33p in the pound as full and final settlement which they declined. Would be interested to know if your company do accept it. My worry would be, what if they take and cash the cheque but still expect you to pay your monthly payments until the whole debt is cleared. Any advice?

saffronella

My cheque was cashed on 7th December. I received a letter also dated 7th December saying "further to your recent enquiry we are willing to accept £2761 as short settlement of your account.
There was no mention of the £400 I sent them. (12p in the £)
But, if they have cashed my cheque for £400, and my cheque had "in F&F settlement" written on it, as well as being in bold in the letter, then surely they accepted the amount as a full and final settlement by cashing the cheque?
I have now stopped the monthly Standing Order to them as it is due to go out in a few days.
Your advices please.

Debt_Free_Chick

saffronella wrote:

My cheque was cashed on 7th December. I received a letter also dated 7th December saying "further to your recent enquiry we are willing to accept £2761 as short settlement of your account.
There was no mention of the £400 I sent them. (12p in the £)
But, if they have cashed my cheque for £400, and my cheque had "in F&F settlement" written on it, as well as being in bold in the letter, then surely they accepted the amount as a full and final settlement by cashing the cheque?
I have now stopped the monthly Standing Order to them as it is due to go out in a few days.
Your advices please.

I've replied on the other thread but, no. Cashing the cheque does not mean that they have accepted your offer of £400 as F&F. What you have done is offered them £400 as an F&F ... but they have not yet indicated that they have accepted this proposal. They can simply credit the £400 against the total debt and ask you to repay the remaining balance. Your payment is only an F&F if they accept your proposal (i.e. £400) in writing.

HTH

Apple_2

I've done 3 !!!!!!'s for my O/H ( only one left now ). Each time it was agreed with the creditor and the cheque went with a copy of their letter accepting the !!!!!!.
I'm not sure about whether you are right or wrong legally - I only know I wouldn't trust these creditors/debt collectors not to pursue the balance without prior agreement. In fact I'm half expecting the balance after O/H's !!!!!!'s to be chased by chancers in a couple of years, so will hold onto the paperwork for grim death.

System

Saffronella - I think the creditor will have treated your £400 as a payment on a/c and nothing else. You send any business a cheque and they'll bank it without question. I sympathise with your situation but personally would never make a F&FS until a creditor had given me prior written acceptance.

The CCCS have advised me that the acceptance letter should state that the amount is in Full & Final Settlement, the amount of the settlement and how long the company's acceptance of your offer is valid for.

By cancelling the monthly payment now, you're likely to aggravate them and they may start legal action if you cancel regular payments. I presume you want to effectively stop £400 worth of monthly payments going out of your a/c? It may be more useful to reduce the monthly payment to £1 for the time being, so that you are still paying something, and see how long you can drag that out to try and "claw back" the lump sum they've banked.

I really think you're wasting your time arguing over the legality or fairness of whether they should have banked your cheque. The only thing you can do is learn from it and never do this again unless you've got an acceptance letter first.

Hope some of the above helps.

Dave