F&F settlement with loan

48k

Hi folks,

I am currently on a DMP with CCCS, my partner has offered to take out a loan to enable me to make Full and final settlement offers to my creditors and then we can work together to pay off the loan she takes out.

Has anyone any thoughts or advice on doing this or has anyone done it in the same way. Any advice would be appreciated.

If i am to go ahead, what sort of % shouldi be offering in F & F to have a chance of th creditors accepting?

Thanks guys!

Tixy

Hi

National debtline have a useful factsheet on this about the process of offering all your creditors F&Fs at the same time.

As to what percentage you will get accepted it will depend on various things.

Some of which include
How long have you been on your DMP?
Are you debts still mostly with the original creditors or with DCAs?
Have all (or most) of your creditors issued a default?

48k

Hi, Of the 7 creditors i think 4 have issued defaults, as far as i know they are all owned by the original creditor but 4 are with the collections departments such as rma resolve for amex and metropolitan collections for hsbc. Hsbc did write to me offering a reduced settlement of 'UP TO' 50% before they passed it to metrolpolitan. I just feel if i can get them to accept F &F's then it is a turning point andi can start afresh, my credit file would be up to date and as long as we repay the new loan correctly then it would have no adverse effects long term i could just repair my credit score quicker. Does anyone think this is the way to go?

G

Pott5y

48K,

I am just in the process of doing this and I have started at 40%. some may say go lower. I have sent out 9 letters and 2 have accepted. This is the template letter I used. Make sure that you get all points confirmed before sending any money.

[FONT=&quot]To: _____________________
________________________[/FONT]

[FONT=&quot]Without Prejudice[/FONT]

[FONT=&quot]Dear Sir/Madam [/FONT]

[FONT=&quot]Account No: [/FONT]

[FONT=&quot]I write with reference to the outstanding debt on the above account.[/FONT]

[FONT=&quot]I can confirm that I am unable to offer to pay the money which I owe in full. As your company will be well aware, I have been making regular payments via a Payplan Debt Management Plan for the last 6 years. Unfortunately, I cannot see my circumstances changing dramatically in the foreseeable future, therefore it is likely it will take almost 20 years to clear the outstanding amount on this account. [/FONT]

[FONT=&quot]However, some of my family members are offering to collaborate to raise £ ([FONT=&quot]which is a pro-rata payment [see attached schedule][/FONT]) and I want to offer this as an ex-gratia payment in full and final settlement of the account. [/FONT]

[FONT=&quot]This offer is made on the clear understanding that, if accepted, neither you nor any associate company will take any other action to enforce or pursue this debt in any way whatsoever and that I will be released from any liability.[/FONT]

[FONT=&quot]I also request that, if accepted, you will make an entry on a credit reference agency file relating to the above account as having been “satisfied” in full and the account closed.[/FONT]

[FONT=&quot]As advised by Payplan no lump sum will be available until I have received written confirmation of all points in the above offer.[/FONT]

[FONT=&quot]Payment can be made within 1 calendar month of receiving your written agreement of this offer. Also if this offer is accepted, please confirm your preferred method of payment.[/FONT]

[FONT=&quot]However if you are unable to accept my offer then I will regrettably have to withdraw the offer and continue paying my monthly re-payments via Payplan.[/FONT]

[FONT=&quot]I look forward to receiving your reply.[/FONT]

[FONT=&quot]Yours faithfully[/FONT]


Hope this is of some help!!

Good luck!!

48k

Thanks, I was going to start at 30%, not wanting to over comit again for the future and hopefully some may accept, some may not but then i guess you can negotiate, im not trying to dodge my mistakes from the past but feel the creditors may go for a lump sum now rather than recieve 20-50/month for over 10 years. Fingers crossed i will look into loans for my partner tonight i think, if possible get an acceptance, then offer F and F's before we commit to the new loan

G

Pott5y

I think that what you have proposed sounds great.

Something else I have learnt is not to rush back too quickly with a higher offer. Keep offering the same for a month or two as the creditors sometimes think that by rejecting your offer you will immediately go back with a higher offer. But this way they may think you have no more money available and may accept at a later date.

Also you must make sure that all correspondance is done in writing. Several have asked me to call them, but they will just try to manipulate you to get more money. Some can try and be underhand and abrupt in their replies. Do not worry it is just them trying to worry you into paying more.

Also if your offer gets accepted make sure you get all the points refering to liability and full and final etc (as per my letter above) agreed in writing before sending any money. If you are not sure copy and paste the letter on here (remembering to remove your personal details etc) and someone will soon advise as to whether to accept or not. Then if it is all good then get you OH to send the money (not cash must be traceable) on your behalf. This is apparently more legally binding.

Good luck with the negotiating.