Can you pay full and final settlement

NG7

on a credit card??

I have finally come clean to hubby about my debt amounting to almost 15K, the biggest one is a loan at 10k and the debt agency have offered a 3k full and final settlement. Hubby would rather put it on his credit card and i pay him rather then me being chased. Anyone no if it can be done or is it just debit cards?

Hannah_10

Hi NG7, you're not asleep either then, you have my sympathies there.

I read your other post too by the way, in which you were asking about a debt management plan that asks you to pay. Have you read Martin Lewis' advice on it? He clearly isn't a fan of them. First off you get into more debt because they have fees and secondly a lot of them are plain useless which means your cheques just sit about doing nothing while you get into even deeper trouble because the debt management company forwarding them or doing thier job in any other way. You'd be better off speaking to one of the charities. It's all in the article here >> http://www.moneysavingexpert.com/loans/debt-help-plan#help But the trouble with feeling desperate you just so so badly want something, anything, to make the problem vanish and so that dire need for relief often bug*ers up your sense of logic and you make another bad decision- like a commercial debt management company. There are people and business's out there that positively thrive on kicking a girl when she's down. (On which note, never ever phone your creditors, always write, you wouldn't wanna know how truly viciously cruel they can be- I found out the hard way *shudder*... just before I had a breakdown, and the "just before" says it all).

Ok stepping away from the desperation, whose offered you a £3k F&F? Is it the debt management company you mentioned in your other post, theone that wants £300, or the debt collecton agency (the ones who you now owe coz the original creditor passed them the account and the ones who you'd write the cheque to)?

If it's the DCA (debt collection agency) or the original creditor then 30% is a reasonable deal, but do not make another desperate leap! You need to consider what the repayments on that credit card are and how much debt that'll put the intitial £3k up to over time. There's a calculator for that here >> http://www.whatsthecost.com/creditCard.aspx The longer your account has been ignored the less they will take as a F&F (full and final offer), so if that £3k is looking a bit trickier or less good value after you've used the calculator thing then just take a few moments to step back and breathe...

Things they can't do to you (honestly)
They can't take your house.
They can't take anything from your wages/benefits.
They can't add to your bill.
They can't phone you if they're upsetting you (we have template letters for that).
They can't send a baliff.
They can't send anyone actually if you say no.
In short whatever you're scared of isn't going to happen (they will threaten you with everything short of toture of course- THEY LIE). Slow down a sec, let your logical head take over and do this slower and more methodically. Ye Gods I wish I had taken my own advice years before I did.

What they can do is lie (they do a lot of that), intimidate (only works if you believe the lies) and harrass (only works till you round on them with the dreaded template letters) and so on. Ever seen Monsters Inc? Laugh at them. I dare you!

Slowly slowly, no panicking, you can get out of this debt no matter how low your income without resorting to anything desperate that will up the over all problem. It might take us a few more questions to work out what the right route is, but for now hit the hot choc/ chamomile tea and breathe! They can't get you if you laugh at them- really, really- cross my heart and hope to die, on my hamsters life ok...

When you've persuaded yourself you're at least gonna try to look like you're not frightened of them you might wanna show us a SOA (statement of accounts) http://www.makesenseofcards.com/soacalc.html because what that would give us is a really clear over view of what can really be done with your exact personal situation. Any advice that doesn't take your exact personal situation as its template is one-size-fits-all-b*llocks and we wouldn't wanna be giving you that.

NG7

Thanks for the reply, no i can't sleep. Been burying this for so long, now its finally out there and real, its all i can think of.
The debt collection agency offered me the 30% although it was on a letter from sept 09 so i don't no if they'd still accept it. The credit card shouldn't be too bad because there is 2 of us paying it and hubbs also works alot over summer so it will get paid off quicker.
In the perfect world the other creditors will accept F&f offers and then the only person i'm in debt to is hubbs. I've been looking more in debt management and i'm not sure i like the idea of it, esp if they don't freeze the interest.
Seriously this money stuff is making me sick to my stomach.

Hannah_10

I know that feeling- oh yes, it has taken me the last 12 years of my adult life to get to a point where being in debt doesn't screw me over every waking moment of the day. Terrible isn't it, a lot like living in fear of a vengeful ex coming after you with a baseball bat except no one is sympathetic and helpful. You get get the old "well it's your own fault" cr*p, and furthermore the "so what- pay it then" cr*p and consequently you grow ever the more woundthef*ckrightup by the day!

I get it NG7, I really do. I've been there- oh how I have been there... Truly, you need to step off the carousel. They have no power over you except to frighten you. Anything else they say they can do is a lie, anything they do that bothers you can be made to stop. It's not easy but stop giving them the power. They've got none if you stop being frightened.

I would love for all your creditors to take a drastically reduced F&F and you end up in 15 or 20% of the original debt to Husband-Dearest instead. But... What I'm saying is Husband-Dearest does not then need to find of the £2250- £3000 he paid out (working on 15-20% of £15,000) then turns into five or six or seven thousand because he had to wap it on the plastic and pay it off minimum term. That's not such a great deal then is it.

Part of stepping off the fear carousell and getting a really good deal on your debt means not doing anything hasty. If that creditor of yours will take 30% today, then ignore it for another 6 months or make token £1 a month payments for a year and they'll more than likely take 20%, or 15%, or whatever they can get just to shut the book. They want you to think that you have to do it right this minute or you'll never get another offer like it, well of course they do, their job is to squeeze you of every penny they can! If the stick didn't work and they got nothing then they're gonna try the carrot.

If that sounds like too much stress then what's making it so? Do they phone you, if so we can stop that. Do they send you scary letters, if so we can act as your personal b*llsh*t filter (just type 'em up and show us- account nubers and names removed of course). Are they threatening you with xy or z? Talk to us.

But don't leap into another debt.

I know it consumes your thoughts and feelingings and it feels like it's a total panic and it's got to be dealt with rightblo*dynow but it's an illusion. Slow up, for your own benefit.

So far to me it's looking like the right way to go is get a SOA together which makes you look as poor as possible, get all interest and charges stopped, offer the creditors £1 token payments each month for a year coming straight out of a bank account you don't use for anything else (I do know someone whose token payments were 20p actually), during which time you and hubby save as much as you can and then a year from now you write the F&F offers not the DCA. They will settle for a pittance and if they don't well they can go back on £1 a month... See how at that point you hold all the cards?

So that's how come your SOA would be lots of help whenever you're ready, we usually tell people how to savagely cut thier expenditure and up thier debt repayments, but in your case it might be more help if we tell you how to represent any income and expenditure you have in such a way as to justify token payments for a bit.

If you and hubby could really afford three grand right here and now I reckon you probably wouldn't be sounding like a cat on hot tin coals right now, you'd be all contented. I might be wrong, you might have a 200k a year combined income and the lowest bills I have ever seen... Might not be wrong though.

Oh and...

They can't get you.

NG7

I no your right, but they do scare me, i've been ignoring them for years, in fact one is almost 4 years. eek.
200K oh i can dream, i bring in about 550 a month and hubbs 1300, he owes 11k but is sensible and paying it on time, i owe 15k i've been ignoring for years. They don't contact me because i moved and they never changed my address.
So should i fill in the soa for the both of us or just me (the debt is all mine) and then send them that with a letter offering token payment??

Hannah_10

It depends, do you reckon you want to address your debts as a couple or as an individual? Coz if he's 11k in debt on £1300 a month then he's pretty heftily in debt for his wage to be totally honest. So maybe wait till morning (MSE's not going anywhere) and have a chat to him.

Oh and did you know after 6 years of non-payment a debt sort of vanishes? It's called statue barring, it means that in theory you still owe it but they can't chase you, they can't take you to court, they can't write, it's not on your credit file- in effect it magiced itself into thin air.

See how useful slower is- you'd never have known that if you went charging into putting that 30% F&F on the plastic.

I am thinking there might be more debts lying about which are either coming up for statute barring or were arranged before April 2007 (the massive majority of these weren't legal- which in effect means they vanish too with the right application of those beautiful things that are the template letters).

Have a think and a nice cuddly chat to hubby about if you wanna approach the debt problem as a couple or as a pair of individuals. Get his help with the SOA too, and of course his SOA too if he wants his looking at (you never know there could be loads we could lop off it). Take your time with this- you have days, weeks even. No more drastic leaps k? We both gotta stop doing that!

Hannah_10

I just used that credit card calculator, it worked out that if you borrowed £3,000 at 14% APR and repayed at the minimum amounts (which is 2% of the balance) you would have paid £6,797.32 off in total over 364 months (that's 30 years and 3 months).

Your 30% F&F has turned into a 68% F&F and a 30 year headache....

To thieve a catchphrase from one of the biggest banks "there's got to be another way".

There is... and it aint more credit.