Full & Final Settlement Advice please!

cts1982

My Partner has £50,000 worth of debt in the form of approximately 8 credit cards (Barclays, Egg, Virgin, Lloyds, Natwest, Halifax etc) from trying to keep a previous business afloat over two years ago. While the business was going we made all the minimum payments on the cards but after the failing of the business my partner tried to upkeep the payments but couldnt.
So, for the last year or so he has agreed payment plans etc with the companies, but they have started to get heavy threatening to put a charge on our home and sell the debt on to colletion companies.

We are currently attempting to re-mortgage our home to offer Full and Final Settlement figures to the credit card companies. The amount however that we can pull out of the equity in our home is equal to approximately £15,000. We are unable to do anything else as I am currently on Maternity leave and recieving only about £500 per month wages myself.

So, to cut a long story short, has anyone got any advice for negotiating Full & Final settlements?
Has anyone negotiated successfully and can give us some tips?
Does anyone know what percentage of the debt is a resonable offer?
What tactics we can use to get the full and final down to an absolute minimum?

Any advice would be greatly appreciated - but anyone who would like to pass judgement on our financial situation is not welcome to respond to my post!

Thank you for your time x

bottleofred

Hi and welcome to the site, we all get into financial trouble from time to time, so don't worry as everyone I've had dealings with on the site have been very helpful and supportive.

Full and final settlement figures vary greatly from creditor to creditor. However, some companies will settle for as little as 20%, while others will want 50-70%. There is no real formula for who will accept what amount. However, you want them to settle as low as possible, so tell them you may be able to get a small amount amount of money from a family member or friend to clear the debt. Put the offer to them in writing and start really low (no more than 20% initially!) and see how you get on. If you don't hear from them assume they've rejected the offer and move onto the next creditor. However, they may make a counteroffer of say 50%, at which point you write to them again and maybe offer 25%. Do this until you can settle, although don't settle at the expense of paying too much. And most importantly, get all offers of settlement in writing and make sure the offer has the words "as a full and final settlement" in the letter to ensure it can't be sold on later for another debt collector to come after you. Don't forget to make counter offers as the most I paid was about 50% on less than £1000 and 20% on over £10000.

Good luck

cts1982

Thank you,

Your Advice is much appreciated - sometimes it is just nice to get someone elses perspective who has been through this personally. My partner is going to contact them all tomorrow and we will get those letters sent out.

Thanks again! x:A

Numpty_Monkey

Send them the letter from here http://www.nationaldebtline.co.uk/england_wales/debt_advice.php#6
"full and final settlement for any debt"

Gonzo did a post a while ago that might give an indication of what to offer
http://forums.moneysavingexpert.com/showpost.php?p=31089645&postcount=7