Paying off creditors - getting the best deal

Alexportland

Hi All,

I was hoping someone would point me in the direction of some information I can't seem to find using the search function.

I'm sure it must be here somewhere but I don't know what terms I should be searching for.

Long story short.....

I had £12k debit - mainly to high street bank loans, overdrafts that went toxic and credit cards etc etc.

I couldn't keep up repayments, ignored it all for a while then eventually set up a repayment plan with payplan.

I currently pay £135 a month - almost all of the creditors rejected the payment proposal from payplan but they have stopped chasing me and are getting the money so I have left it.

I have paid £2k to justabank now so hopefully my total debt stands at around £10k.

I have some money coming from an inheritance that will probably mean I can pay all my debts off in full :T

However, I want to make sure I get the best deal when I do, back when I was talking with the creditors they were always offering me discounts of 10-40% if i paid in full immediately. So i expect i can do some haggling now.

My question (finally got to it) is what is the best process for negotiating pay off discounts?

I dont want to leave it to payplan because they are useless and just send template letters (which get rejected)

I am happy to call all the creditors myself - but is there a best way to approach it?

i.e - if I tell them straight up I want to pay it all off then they might be less likely to offer me discounts, so should I call up an pretend I am trying to reduce my monthly payment to make them think i am a bad debit and get them to offer me the best deal?

any thoughts?

Where should I look for info? what is this type of thing called?

many thanks

Alex

GeorgeUK

There are a few different letters you could send, but these are generelly referred to as Full and Final (F&F) settlement. It is important that this is done in writing rather than on the phone and that you wait until you receive written confirmation before sending payment. If the state in the letter that the settlement is a partial or short settlement, then don't accept. You want them to confirm that the payment will be in full and final settlement of the debt and that you will be absolved from any further liability.

This is a pretty good example - there is also a letter on the nationaldebtline website
http://forums.moneysavingexpert.com/showthread.html?t=1200137

It is best if you give them a date to respond by and to make it clear that you will be offering the money, coming from a 3rd party, to other creditors if they are not interested in taking it.

Payplan_company_representative

Hi Alexportland, when it comes to you being in a position to paying your debts in full, we have a dedicated team who will negotate settlements with them all. If you contact your case officer and tell them your situation then they can take it from their. I hope this has helped you.

Lizzy