Debt free plan- what should i offer?

Banners24b

Hi all,

i've been on the phone most of the day to Lloyds, Moorecroft and Robinsonway

basically i owe £2400 to SCM Lloyds for a credit card,
£2400 to Westcoast for a old account
£1270 to Robinson Way for an old account

I can't afford to pay the "full"amounts in one go so have asked them for settlement figures, which all 3 are offering %20 off the debts,
I';m not fussed the affect this has on my credit rating as this is screwed anyway but is %20 normal? or should I try to be cheeky and offer lower, typically whats the accepted amounts

Thanks

Phil

Tixy

Hi Phil

Only ever make full & final settlements in writing and make sure you get their written confirmation that your payment will be in full & final settlement before you make the payment.
(lots of people have made agreements on the phone and then found themselves being chased years down the line for the remainder).

As your debts have all been passed to debt collectors then I would try to offer a lot less than 80%.
What is the situation with the debts? when were they passed to the debt collectors? how long ago since you defaulted on the debts? are you currently making any payments towards the debts? how long ago did you last pay them?

Banners24b

Hi they all got passed over in about Sept of last year from SCM Lloyds to the various agencies, I was making small payments reguarly but havnt done for the last month or two, the default notices went on my credit files in nov 2009!

Tixy

I'd be tempted to write to them with offers of around 25% (thats 25% of the debt not a discount of 25%). They may well write back and say they won't accept these and you may need to negotiate up a little. Should certainly be able to settle for no more than 50% of the debt (these DCAs will still be making a stonking profit on that).

There is a useful factsheet and template letter here - http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=24_full_and_final_settlement_offers

Some people choose to put in the letter that if the offer is not accepted by X date (give thema couple of weeks or so) then the money will be offered to another creditor.

Banners24b

thanks for the advice Tixy, I've written 3 letters and will post them out today and see what i get back , i guess the worse they can say is "no"

Banners24b

Ok so negotiations are ongoing with my three debts, I offered 25% as partial but final payment which got a resounding "no" from all 3 creditors.

I have a lump some of 2k to try and pay back 5k worth of debt, which i'm splitting evenly between the 3 creditors. if none of them take my maximum offer what options does that leave me?