Acceptable amounts/tactics to offer credit card companies?????

stugall

Hi folks

I owe the following amounts:

Cabot (original Monument) £3,349
MBNA £4,986
Halifax £3,238

I have never reclaimed credit card bank charges. I pay minimums to all three on time by standing order.
I have rarely been chased. I really call them. On the one occasion, I was sickly sweet to them. Occasionally I have also made lump sums to bring them down. A couple (not MBNA) offered partial settlements circa £2,700.

I want to pay them off, anyone any suggestions on
a) an amount; and
b) a tactic?

Best
Stuart

Jesthar

Hi Stu,

A lot will depend on how much you can afford to pay off both as a lump sum and on a regular basis - better to be paying more than the minimum of the card with the highest APR if you can, as that will be costing you the most money. Can you give us some idea as to the funds you have available etc.?

And you should definitely look into reclaiming your credit card charges ASAP!

Sorry for the vague reply, just need more infor to work with, really.

~Jes

stugall

Hi Jes

I can afford to pay off about £4,500 in cash,

I have written to them all re the standard template letter

Thx
stuart

Jesthar

Ah, OK - standard template for a fair and final offer, you mean? Guess you'll have to see what offers they come back with. Not sure if you can haggle with them afterwards, but it may be do-able...

If you don't get any joy from any of them, then pay the money off the one with the highest interest rate. If that clears that card, put the rest of the money towards the one with the next highest interest rate.

After that, pay the extra money you would have been paying beforehand towards paying extra off the remaining debt with the highest interest rate, and you will clear that a lot quicker and save yourself a fortune in interest!

The one exception I would have to the above is if any of the cards are over the limit and you are getting stung with charges every month, bring all those cards back within the limit by a sensible safety margin first, then throw all the remaining money at the highest APR etc.

In the meantime, press ahead with reclaiming your charges, as when that comes through you should have another good lump sum to pay off the whatever is left!

~Jes

skintandscared_2

I don't know if they will be in too much of a hurry to accept full & final settlements when you haven't had any trouble keeping to the minimum payments. What incentive is there for them to settle at less than the amount outstanding?

iolanthe07

What incentive is there for them to settle at less than the amount outstanding?

And why should they?

skintandscared_2

Yes, that's what I mean. If people DO get offered full and final settlements it's usually when they've been on a debt management plan for a good long while and are only making token payments. They also have wrecked credit ratings and no chance of getting any further credit for several years to come. If you can manage minimum payments you are really in position to expect companies to suddenly cut your debt in half and let you walk away from it!

A_fiend_for_life

Worth asking for a reduction in your APR too - especially if it is over advertised rates. A couple of years ago my credit card was increased gradually to 28% and I negotiated it down to 20%.

Might be worth looking at.