What Now What Next Where To

emjel

Just had my offer of £7k Full and Final Settlement against an early settlement figure £9.3k turned down by HFC. Even though I said in my letter that I could no longer afford the £400 pm and that one third of the offer ie £2400 was being paid by a friend on the basis that it was used as part of a F & FF, they still suggested I put the £6.9k to paying off a chunk of the loan. All that will do is reduce the actual balance from £15k down to £8k.

Any suggestions on the next step. Thanks

CLAPTON

can you give a bit of background
when did you default on the loan repayments?
have you arranged a reduced payment plan
have they sold the debt on to a DCA?
do you have any other debts
are you in a DMP?

emjel

Clapton - No nothing like that. As a bit of background, when I took out the 7 yr loan for £12k in 2003, I was told that although interest charges were high (24.9%), it was because the loan was very flexible ie, I could pay off additional amounts thus reducing the interest charged and the term. This suited me fine as I anticipated paying it off within 2 years. A change in job through redundancy lowered my income 18 months later, and these last few months it has been difficult to repay, although I have been using the "robbing Peter to pay Paul" using a credit card. However, having paid of some additional £4k in the first 9 months and the regualr payments, I calculated that by Jan 07, the loan would be down to around £5k now.

When I got chased for an arrears of £23, I asked them what the settlemnt figure was - they told me current balance was £15k, but that would get reduced to £9.6 for Early Settlement. After I recovered from the shock, I paid another instalment of £400 but wrote to them with the offer. The other annoying thing is that I have the dreaded PPP. I asked them to cancel it in 2004 but they said could not do it. The only way would be another loan to cancel the first. As mentioned, the idea was to pay the loan off 12 months later. Since offering the £6.9k, I found out a week ago that I could have cancelled it, and saved myself £90pm. So I reckon that they owe me 24 x £90 at least. This is why I now think my offer is really good.

CLAPTON

ok i understand where you are coming from but...
there seems to be no reason why they should accept a F&F because you are paying the repayments....

usually F&F are acceptable to your creditors if
you are un able to pay the monthly payments and have either stopped paying or paying less that the contracted amount
they have defaulted your a/c and so your credit record is trashed.
a year or so has passed
they have sold on your debt to an DCA
then its likely you could arrange a F&F.

thats how it is but best of luck.

emjel

Out of interest, how much would they sell the debt on to a DCA. 80% of debt. I still think they are being unreasonable - they have had £18k back in 40 months. With the other £7k, that will make £25k. Had I just kept to origianl payts, they would only have had £15.5. So they've had £10k 44 months earlier. Maybe I should do as the National Debtline say and let the court decide especially over the PPP ripoff

CLAPTON

they would only sell the debt on once its been defaulted (and after your credit rating has been trashed)
how much they then would sell the debt on all depends upon the detail (how much was outstanding, how much you were paying, was there a CCJ etc ) and i dont know the answer but its not your current situation.

i dont really understand what you mean about the national debt line...have they given you advice?

also i'm not really sure about your figures...you said you originally took out a 12k loan over 7 years at 24.9% ..that would have meant that if you had simply paid it off in the normal way you would have paid a total of 25,500 at a rate of 302 per month...in addition of course you had the PPI payments.

emjel

Clapton - sorry for misleading you. The loan was for £12k. Ontop of that there was £4.5 for the PPP. Add the interest to both loan and PPP and the total was £32k over 84 months. As mentioned, I have paid £18k and have offered the other £7k. There is obviously an early settlement rebate of £5, and this is where the £2k shortage is. I think I need to attack the PPP issue. Had I been allowed to cancel it 2 years ago, I would have saved nearly £2k. Even if I cancel it now, the fact is they will try and keep the full amount of the premium knowing full well they will never have to cough up in the next 44 months. So they're quids in here too. Absolute rip off. No wonder the Trading Standards and FSA are looking into these things.