Mum to the rescue!

Achelois_2

Dear all

I am writing to ask your advise as my Mum has offered to help me with my debt by offering me £3600 to pay off which I do not need to repay.

I have quite a considerable amount of debt which I have detailed below but obviously want to make the most of her offer to help me get rid of the debt as soon as possible. Can you make suggestions as to how you would apply this money and or how I would write to ask for full and final settlements therefore paying less than the amount outstanding?

I really appreciate any help / advice you can offer.

Marbles 29.9% APR - have managed to maintain paying this at £115 per month - balance outstanding £2058.50
Barclaycard - 19.9% APR on an agreement to pay at £58.67 per month with a 0% interest for 6 months, balance outstanding £3767.93
RMA Amex - this has been passed to RMA and I am therefore no longer paying interest but pay £69.56 a month with a balance outstanding of £4,066.79 and they have already informed me that they will accept £2945
Marks and Spencer Flexible Loan - £7,338.06 at 12.9% APR and they have given me a settlement figure of £5919.17 I pay £135.89 per month
Northern Rock flexible loan at 7.9% APR oustanding amount - £11,384.24 I pay £203.28 per month and they have given me a settlement figure of £9290.82
Finally, last but by definitely not least!, Lloyds Loan Non Flexible at 7.01% APR balance £21,329.01 and I pay £373.86 per month.

Thanks for any help you can offer

A xxx

MyopicMoo

Hi, what a lovely mum! I'm not an expert but I would think your best bet would be to accept the offer from RMA (but ask for it to be marked as satisfied on your credit file) and then throw the rest at the Marbles card as the APR is the highest (really scary!).

Oneday77

I would clear the Marbles account as it is by far costing you the most.
That would leave £1540, roughly.
Ask you mum to keep it for you. In the mean time give her the £115 your saving each month to add to the £1540. After 6 months she will have £690 extra. Take that new amount to the DCA and offer a F&F of £2230. You will have paid another £420 to them in that time anyway and they will be very likely to accept it.
After those 2 are clear you will have an extra £185 per month to throw at the Barclaycard which will snowball down nicely with that extra each month.
The other option is to clear marbles and put the rest to the barclaycard straight away.

I think the 1st option is better as you will save more with the F&F that the Barclaycard will cost interest.

Achelois_2

This was my thinking but then as RMA are effectively 0% would I not be better trying to put the money towards some that have interest? Thanks for your help.

Achelois_2

Ps - My mum is amazing, my best friend x

Achelois_2

Do you think I could make an offer to Marbles?

Oneday77

The loans would be nice to clear down but they will clear by themselves.
CCs you always run teh risk of re-using so do as much repair to them as possible and then snowball them down. RMAs offer saves £1000 which is 1.5 years of interest at Barclaycard.
Visit www.makesenseofcards.co.uk/snowball.html and see how your debts will pan out CC wise.
It may be worth CCA'ing the CCs and see if they are valid before making offers too, you might get them over a barrel. RMA might only have paid 10-30p in the pound from AMEX. Porbably no more than 50p in the pound. Always less if the CCA isn't valid.

Oneday77

Achelois wrote: »

Do you think I could make an offer to Marbles?

Crossed posts but CCA them and see if they are valid. If not make an offer and see what they say. You could try that you are going to need to enter a DMP but your mum is offerinmg to help you to keep you out of it and pro-rata the money across the CCs & DCA as offers.

Achelois_2

Sorry to be naiive but what do you mean by CCA'ing?

Oneday77

Achelois wrote: »

Sorry to be naiive but what do you mean by CCA'ing?

Sorry been here too long

Have a wee read through http://forums.moneysavingexpert.com/showthread.html?t=2060575

Basically you query for the Consumer Credit Agreement and then check that it is valid and legally binding. Now I wouldn't advise using it as a way to pay nothing, some people do. It is more a way of buying a little time and then knowing which creditors have a leg to stand on regarding enforcing your debts.

If you follow through Never in Doubts post the template letters are there and explain what the steps are in order. Just supposing the CCA on the RMA is not enforceable and you point it out, they would be probably willing to take a lot less than their initial offer. If Marbles was similar they would probably accept a lower offer from you and so on. It isn't guaranteed and I am no expert so I may be contradicted but that is it in brief.

Achelois_2

thanks for your advice - I will have a look now