F&F's - first step, will we make it?

on-the-up_5

Hello,

I have been reading these boards for months but this is my first post so I might talk rubbish!

My husband and I stupidly got into debt and found that we could not make the repayments when his overtime and pay rises were stopped due to the climate!:mad:

We have been in a DMp for 6 months and it is going well. I have just come into some money so tonight I have written the first F&F letters to 5 of our 8 creditors. We have a total of £29,000 approx :eek: unsecured debt but I am determined to get out of this mess. I have chosen to try to settle the debts that are now with Credit Agencies plus two credit cards where the interest has not been frozen.

Credit Solutions £1235 offered £675
Debt Managers £615 offered £335
Debt Managers £2585 offered £1400
Barclaycard £1850 offered £1000
Halifax Card £5318 offered £2875

Has anyone else tried to settle with any of these creditors? What chance do you think we have?

If we could get rid of these 5 we could make a payment of £100 to each of the remaining as we currently pay £300 per month to the DMP.

I have been through all our finances and changed to the best deal on our mortgage, utilities and mobile for my husband and we have cut all spending right down to a minimum. :T

We have a two year old daughter and I swear that if I get out of this with my mind I will do all I can to teach her how to handle money responsibly. I am learning from my mistakes so she doesn't repeat them.

Any comments will be greatly appriciated.

Thanks in advance.

O-T-U
x

fatbelly

on-the-up wrote: »

I have been reading these boards for months but this is my first post so I might talk rubbish!

Not at all! Very clear post. Very sound strategy (I might have suggested starting a bit lower but...)

Creditors usually reject the first offer. Don't let that put you off. You have made sensible and fair offers. There is no way these debts would sell for 55% so their best chance of getting quick cash is to play ball with you. At some point you may need to have a chat with them but make sure that any deal comes back to you in writing from them. It should use the phrase 'full & final settlement' and say how your credit file will be marked.

on-the-up_5

Having some difficulty ensuring I have the correct addresses so letters will not be sent until tomorrow now but I am still thinking positive!

Thanks Fatbelly for answering.

MountainOfDebt_2

Sorry to hijack this, but you said there's no way the debts would sell for 55%. Is there a rule of thumb on what DCA's pay for debts? I guess it's a long peice of string to be discussing, but is there soem sort of brtacket, has anyone worked for them so can comment?

DeBilde

DCA's usually pay around 10-20p in the £ for debts.

on-the-up_5

Do you think I have started to high. Have not posted letters yet so could try lower? Any ideas?

Thanks

riquelme

ive got 17k worth of debt and have recently offered approx 6k which is circa 35% which in turn is about 50% of what i can afford to pay. I think ive started slightly too high after reading other threads

on-the-up_5

Thanks Riquelme. Let me know how you get on.

DeBilde

Original Creditors will not consider anything below 90% of the balance if the account is up to date. If you are on a DMP or AR then maybe they will cut their loses and take say 50-60% if they think it will take a long time to repay. If the debt is sold to a DCA then figures from 10% up to 35% are realistic offers and may well be accepted.

riquelme

DeBilde wrote: »

Original Creditors will not consider anything below 90% of the balance if the account is up to date. If you are on a DMP or AR then maybe they will cut their loses and take say 50-60% if they think it will take a long time to repay. If the debt is sold to a DCA then figures from 10% up to 35% are realistic offers and may well be accepted.

thanks for that info, im going through separation and will not be able to afford my DMP in a month because of renting another property. this money is the only chance of clearing what i owe. when i hear from the creditors my next move is to spell out the situation stating that my payment will be drastically reduced when i move out of the family home.

good luck on the up and sorry to hi jack the thread, will keep you posted though

Arfhurdaly

DCA's will take less, if they have bought the debt.

If the DCA is acting as an agent for the original creditor, you have less leeway, and probably 70% max is what they accept.

You can check who owns the debt by looking at your credit report.