What to offer creditors

horseygirl_3

im currently with payplan and paying back a total debt of £41,000 with about 5 years left.

im in the lucky situation to get my hands on funds to pay off the amount but not fully.

if i offered each creditor a set percentage to clear it what should i offer them? 50% 60% 70%

i dont want to anoy them just pay them off.

any thoughts

GeorgeUK

If the debt is still with the original creditor, it is usually advised to offer 50%-75% but with a DCA, 25%-50%. If you have the funds, you may want to try 10% above the minimum if you don't want to waste too much time on negotiating.

horseygirl_3

the debs i have are as follows , these are my main ones i would like to clear:

hsbc gold card 9k - passed to a debt collection agency but i think are still apart of hsbc as i have spoken to hsbc about a managed loan to cover it.

so should i offer 5k ish

i also have a loan with hsbc im not sure if they would take a lower settlement as its just a loan

interesting answer so thankyou

Burlesque_Babe

I'd start lower than 50% foryour HSBC card as it is with a DCA - personally, I'd go in at 25% and probably settle at 30% or so.

Are you in arrears with the HSBC loan?

skintandscared_2

How long as your plan been running?

I read that F&F settlements to the credit cards could be up to about 75% but that DCAs COULD accept as low as 30% because they've paid peanuts for the debt and would still make money at that sort of settlement. But just make sure you get it in writing BEFORE you send your payment that it's in F&F settlement and the complete debt will be discharged! Otherwise they could take your payment, cash it then start chasing for the balance!

GeorgeUK

I agree that you should offer 30%-35%. They may give a flat refusal or they may come back with an offer. If you can budget for that then if may be worth doing.

Have you requested copies of credit agreements for any of the debts? If the CCA is unenforcable, it may put you in an even stronger position to come to a good reduced settlement.

Remember the golden rules though.
Don't send any money until you have written confirmation that the payment is full and final, and that no other company will chase you for this debt (the nationaldebtline template letter is a good one to use)
State the the funds are coming from another source and that the offer will only be available for a limited period. This should give you some room to manouver the price as you could say that other creditors have refused your ofer so if they come back with some thing that may be a little steep, you can make a counteroffer.

horseygirl_3

i have spoke to payplan and theysay that they have a team that deals with !!!!!! so will maybe let them handle it.

GeorgeUK

I think they would probably need to offer the same % to each company you owe money to. Is this how you want to split the funds?

horseygirl_3

to be honest i would prefere to manage it myself as i would offer less than payplan i think.

edinburgher

horseygirl wrote: »

to be honest i would prefere to manage it myself as i would offer less than payplan i think.

That might be a thought - while Payplan do good work, they are very busy too and I've found them a bit slow with !!!!!! in the past.