Offering a lower final payment?

Bob_Trousers

Hi all, I'll keep this as brief as possible.

While me and the now ex were still a couple, I took out a mobile contract with O2 for her. After we split (and after her messing me around with regards to money she owed me) I had the phone blocked from use, and made an agreement with O2 to pay off the remainder of the contract over the next year (this way, I could reduce the monthly cost of the contract each month, until it would only be £10 per month for the last eight months-worked out to be about half as cheap as paying it all off in one go).

Anyway-that's the background stuff. After a couple of months I rang them to find out what I owed (I'd waited so long because I assumed they'd be in touch with me via a statement each month-turns out they don't do that anymore and hadn't told me. Oh, they also hadn't updated my address details like they said they would, and they'd got my email address wrong as well).

So, they've closed the account due to non-payment, and passed it on to a collection agency who want the best part of a grand to pay it off (this is double what I'd expected to pay). The nice lady who I spoke to at O2 said it might be worth offering them a lower final payment figure-does anyone have any experience with this? Is it a case of they might rather have a one-off payment of £500 than have me pay them back at £5 a month for god knows how long?

Any help and advice is greatly appreciated, thankyou.

Bob_Trousers

Sorry for bumping this up, but it's only been posted an hour and it's already onto page 2. I'm hoping to ring these people tomorrow, so I'm hoping I'll be able to catch someone who's had experience with this kind of thing.

Tixy

Yes essentially thats how F&Fs work.

If its actually been bought by a debt collection agency then they will have paid far less than the book value (anything from 9p in the pound to perhaps 35p in the pound depending on the deemed chance of getting any funds recovered.

So even if you pay 50% it is still quite possible they will make a profit.

If you do offer a full & final settlement the key thing is you need it in writing from them that it is in full & final - so that they cannot chase you for the remainder or sell it on to anyone else to chase you for it (it does happen).

This factsheet should help http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=24_full_and_final_settlement_offers

Which debt collection agency is it? as people might be able to better advise what discount you could get.

Also have you asked them provide a breakdown of the debt? It might be worth doing this first as its so much higher than you expected.

Bob_Trousers

Thanks very much!

The debt has been passed on to a company I've never heard of-BCW.

The reason the debt is higher is this: If I wanted to pay the debt off straight away, I would have been charged £70 a month for the remainder of the contract. If I was patient and paid it off monthly, I could reduce it down little by little-so first month £70, then £55, then £45 etc etc, until I would be only paying £10 a month for the last eight months of the contratct. I imagine that O2 passed on the former to the debt collectors.

Do you think it's best to ring or write to them?

Tixy

We never advise people to phone debt collectors. They will pressurise you into agreeing to pay more than you can afford and lie about their powers (court threats etc).

Its generally advised to do everything in writing so you have an audit trail of all communication with them.

Marisco

Write to them. Its always best to deal with DCA's by letter, that way you have a record of events, and they cannot say something different at a later date:)

Bob_Trousers

Thanks guys! I will have to ring them to get their address, but that's all I will phone them for.

Blahah

Don't call them for anything! Their address is on their website - http://www.bcwgroup.com/contact-us.asp

The head office address is:
bcwhouse, 24 George Square, Glasgow G2 1EG

bottleofred

Hi Bob trousers,

Don't call them! Make all offers in writing and start with a really low offer of settlement as Tixy suggested, as it's all a game really. They may come back with a counteroffer of say 40%, but you don't have to accept this and you can make another counteroffer. However, DON'T pay anything until you have a letter which has the words "as a full and final settlement" in it for the agreed amount. This ensures the remainder of the debt can't be sold on or the debt collector can't come after you later down the road.

Good luck in getting sorted