Pay off credit card totally, and cut up, for a discount

NickNik

I have about £13,000 on a credit card (0% transfers etc), which I am now in a position to pay off fully. I have been a good consistent payer since I have had this card.

As I see it, this amount is 'at risk' to the card issuer as it is totally unsecured. I feel that I should negotiate a reduced settlement figure with them as by paying in full will be good for them as it kills off any risk in recovery, and they are also getting it all paid today, not over months or years.

Can anyone advise me on what the best approach would be to achieve a discounted settlement figure?

The card company is MBNA.

irs101

I guess this is a troll, but hey what the heck.....

You owe the money, if you can, then you should pay it. What justifiable reason can there be for not doing so?

fbs_4800

Whereas I say, if you CAN negotiate - DO. It'll make up for the MILLIONS and MILLIONS of people getting ripped off all over the world daily.

*puts soapbox away*

YorkshireBoy

fbs_4800 wrote:

*puts soapbox away*

...and any hope of obtaining mainstream credit for several years to come, once you have an 'arrangement to pay' on your credit file.

Not a very good idea in my opinion.

irs101

fbs_4800 wrote:

Whereas I say, if you CAN negotiate - DO. It'll make up for the MILLIONS and MILLIONS of people getting ripped off all over the world daily.

*puts soapbox away*

And what about the millions of people who just pay for what they buy? Or the millions who struggle to pay off their debts, because they think it the right thing to do because they take responsibility for their own actions? Or the millions who (sometimes through no fault of their own) really can't afford to service their debts, but are put through the mill by the CC company, because they think they're trying to rip them off.....like this guy is.

sarymclary

I think you should pay your debt in full. It's your debt, you incurred it, and it's your responsibility. That said, why don't you just ring MBNA and see what they'll take?

IMHO, I don't think they'll be at all interested in any 'offer' you might be trying to negotiate with them, unless you have a proven track record with them of not being able to manage your debt, and have a history of communication with them to the effect that you have serious financial difficulties and are not able to pay your monthly minimum payment to them. I would think that only with that kind of history would MBNA consider a reasonable offer from you.

My DH and I did this many years ago with car finance and credit card companies, but we had the best part of 3 years of debt problems, which included several letters and phone calls to them stating that we were struggling to pay our debts, and had negotiated alternative payment plans with them (we were trying hard to avoid CCJ's, which we ultimately did) over many months prior to us making our offers. In this kind of circumstance, the bank is better to retrieve a sizeable portion of the debt, rather than face the looming possibility of not having the debt repaid by us at all.

Since the banks have changed all the rules and regulations over the years since then, I would imagine they might well be more guarded before accepting any offers, but why don't you just go ahead and try anyway?

A last word of warning though, despite clearing all our debts, our history of struggling to pay our debts did follow us for several years, particularly when it came to getting a remortgage when we wanted to move house, and we ended up getting one with a high interest rate, despite my husband's income being more than £50k. So, what you might see as a bargain on your £13k now, may well cost you thousands more in the future, as well as affecting whether you can get other purchase finance in the future.

M_Thomson

NickNik wrote:

I have about £13,000 on a credit card (0% transfers etc), which I am now in a position to pay off fully. I have been a good consistent payer since I have had this card.

As I see it, this amount is 'at risk' to the card issuer as it is totally unsecured. I feel that I should negotiate a reduced settlement figure with them as by paying in full will be good for them as it kills off any risk in recovery, and they are also getting it all paid today, not over months or years.

Can anyone advise me on what the best approach would be to achieve a discounted settlement figure?

The card company is MBNA.

As the poster above mentions, what a ridiculous idea if you know you can pay it in full. Your credit file will be wrecked, and do you seriously think the MBNA will not catch on to the fact that when you make an arrangement to pay they will be able to tell you can pay it back? They ask to see all your income and outgoings etc.

blacksta

I would advise that you pay off and forget the arrangement idea. If it is your debt then it become your responsibility to pay it off. Save your self the hassle.

NickNik

Thanks for those who provided advice. For those who say 'you owe it - pay it all', please do remember that credit card companies (and banks) buy money so they can sell it to us at a higher rate. The margin between buying and selling is what keeps them fat. Asking for a discount for complete settlement is like walking into a shop and asking for a discount for cash, paid now. I am sure you would not find that offensive. Strange though we seem to have an inordinate number of supporters of credit card companies here! (??)

YorkshireBoy

NickNik wrote:

Strange though we seem to have an inordinate number of supporters of credit card companies here! (??)

With respect, you're missing the point.

The increase in bad debt for the banks costs us all money in the long run - whether it be through higher interest rates or the introduction of more fees etc.

Asking for a discount for complete settlement is like walking into a shop and asking for a discount for cash, paid now

No it isn't. With your analogy, you'd agree a price before you removed the goods from the shop - and pay there and then. What you're proposing is taking delivery, using the product, and then (some time later) defaulting on the agreement - saying you're not prepared to pay what was agreed.

Don't you have any morals or values?

domestic_goddess

Well said Yorkshire boy.

However the banks make their money you agree to it when you open your account.

I struggle to pay my bill sometimes but I know that I spent the money so it is down to me to pay it back..... It annoys me so much that other people feel different.

At least with people claiming back bank charges you can at least see where they are coming from. You have spent the money, agreed to the interst charges so no you need to pay what you owe