MBNA offering 'settlement' options?

crowdies

Hi, Have just received a letter from MBNA re my outstanding debt (£16,540.22). which they advise will be legally assigned to debt collectors at the end of this month. They go on to say 'however, I am prepared to take steps to prevent this from happening This will not be possible once the account has been legally assigned, and it therefore represents a once in a lifetime opportunity to reduce your debt'.

the options are available are make a payment of £5,789.08 against this full debt then I will consider writing off the remainder, and will reflect this on your credit file. If you are unable to raise fund immediately, lease contact me to discuss alternative options. Alternatively, for a fixed period, I may be prepared to release you from your obligation to pay the minimum amounts required by our standard terms on the condition that you instead make reduced monthly payments on your account. I will fix the level of the reduced monthly payments, and as long as you make those reduced payments, I will also suppress interest on your balance. This means that any payment received from you will be deducted from your outstanding balance'.

I am obviously keen to take any opportunity to reduce my debt but am suspicious of the language they are using. I am already on a payment plan with CCCS and am paying £115.78 a month to MBNA, and they are not currently adding interest to the debt. Not quite sure what to make of this, or what action to take so would be grateful for any advice.

Fire_Fox

crowdies wrote: »

Hi, Have just received a letter from MBNA re my outstanding debt (£16,540.22). which they advise will be legally assigned to debt collectors at the end of this month. They go on to say 'however, I am prepared to take steps to prevent this from happening This will not be possible once the account has been legally assigned, and it therefore represents a once in a lifetime opportunity to reduce your debt'.

the options are available are make a payment of £5,789.08 against this full debt then I will consider writing off the remainder, and will reflect this on your credit file. If you are unable to raise fund immediately, lease contact me to discuss alternative options. Alternatively, for a fixed period, I may be prepared to release you from your obligation to pay the minimum amounts required by our standard terms on the condition that you instead make reduced monthly payments on your account. I will fix the level of the reduced monthly payments, and as long as you make those reduced payments, I will also suppress interest on your balance. This means that any payment received from you will be deducted from your outstanding balance'.

I am obviously keen to take any opportunity to reduce my debt but am suspicious of the language they are using. I am already on a payment plan with CCCS and am paying £115.78 a month to MBNA, and they are not currently adding interest to the debt. Not quite sure what to make of this, or what action to take so would be grateful for any advice.

I would go via CCCS and get them to do any negotiating on your behalf. I don't like the airy-fairy tone.

pepe2008

Never accept an offer of reduced payment unless it is as Full an Final. Words like 'may' and 'possibly' have no place in this sort of negotiation.
CCCS would rather split up any lump sum between Creditors so as to appear fair.....which is good for them, but bad for you.

mummytofour

Thats a 1/3 of what you owe, hmm I bet they could be beaten down if they have come to you straight with such a low offer. How long have you been with the CCCS? I have been with them a year and was wondering if MBNA would offer me a discount..

Toffee_Penny

Just to say OH received the exact same letter today and here we were thinking MBNA were being nice offering us such a massive cut, shame we don't have the £3000 odd to clear our £10k one though! :rolleyes:

fatbelly

This is standard MBNA practice before they sell the debt.

I've had a few clients take advantage of it - they will even let you pay in a few (three or four) instalments.

Never had a problem so far though obviously you want the deal in writing with sensible wording

If anyone gets better than 33% with MBNA please let us know.

Deep_In_Debt

Make sure you get any "offer" in writing before sending any money and that it is in f&f and that you file is marked as "satisfied" and that neither they, nor any associate or 3rd party will chase you for the remainder in the future and that you are released from any further liability. This is important. National Debtline have a good template letter you can use.

Have to say, am well jealous" MBNA have not written to me to offer any f&f but instead have written to accept my restructed payments on a debt of 9k (I'm with CCCS and have been for the last year) - I'm still waiting for that letter to come!

crowdies

Thanks for the advice, I will speak to CCCS on friday when I get the afternoon free from work. I suspect that the size of my debt, and the current credit-crunch climate, has influenced this as well. I have been with CCCS since since May 2008. It's been quite a roller coaster since then... It all started when I asked my bank at the time (HSBC) for a temp increase by £200 to my overdraft as my wife was working part time. They said NO and pulled the plug on our account. Since then we have had the world economic crisis/credit crunch, and for a time I was feeling that I had started it all!
....;)

Deep_In_Debt wrote: »

Make sure you get any "offer" in writing before sending any money and that it is in f&f and that you file is marked as "satisfied" and that neither they, nor any associate or 3rd party will chase you for the remainder in the future and that you are released from any further liability. This is important. National Debtline have a good template letter you can use.

Have to say, am well jealous" MBNA have not written to me to offer any f&f but instead have written to accept my restructed payments on a debt of 9k (I'm with CCCS and have been for the last year) - I'm still waiting for that letter to come!

crowdies

Hi, we don't have the £5,000+ either but it we will at least look in to it. Don't think their is such a thing as a 'nice' bank.:cool:

Toffee_Penny wrote: »

Just to say OH received the exact same letter today and here we were thinking MBNA were being nice offering us such a massive cut, shame we don't have the £3000 odd to clear our £10k one though! :rolleyes:

crowdies

Exactly my thoughts. Thanks for the advice.

Fire_Fox wrote: »

I would go via CCCS and get them to do any negotiating on your behalf. I don't like the airy-fairy tone.

crowdies

Further to my last post, I was left a voicemail from MBNA requesting I call them. I told them I was interested (obviously) but the language was a bit vague and would like something in writing. The person I spoke too said they would send something and also said that installments were possible as well. I received nothing by post, regarding that but did get a letter requesting I may a payment of £15 a month to prevent the debt from being passed on. I called them again and spoke to another lady this time. She said they would put something in writing, but needed to know first how I would fund it, as they would need to get a director to agree etc.. I also queried the £15 a month letter. She said that if I paid that (and not go throught CCCS as the amount would get shared) it would prevent the debt being sold on, and allow the option of having a settlement with them at a later date, which would not be possible once sold on. She also said that if I made an offer of 30%, they would accept it. Any advice?
many thanks

fatbelly wrote: »

This is standard MBNA practice before they sell the debt.

I've had a few clients take advantage of it - they will even let you pay in a few (three or four) instalments.

Never had a problem so far though obviously you want the deal in writing with sensible wording

If anyone gets better than 33% with MBNA please let us know.