Short settle / full and final

tommytynan123

I am tidying up my finances ready for redundancy in Oct. Part of my package is a lump sum and so I'm going through all debtors and deciding what to do with each.

In one case, store card, (£3500 - defaulted after an awful awful life changing event - charged loads of charges etc and the original balance was about £2000) has been paid at £50 pcm for 18 months and due to their refusal to suspend interest my balance has fallen about £30 in that time).
I have now cancelled the standing order and I wrote to ask for a full / final figure. The reply was positive but to my surprise they threw the question back to me and asked me for an offer. I have 2 Qs if anyone can help:

1. Is it normal / acceptable to make an offer with the caveat that it must include 'satisfied' rather than 'partially satisfied' on the credit file ??
2. What % would you start with that caveat built in ??

Thanks

Oh and thanks to all who have replied to my posts over the last 2 years. Postman brought me a letter today from a High St bank offering a refund of almost £8K on PPI. I'll accept but rather than party time every single penny is going towards other debtors next month and at this rate, on redundancy, I will be debt free Thankyou all again. :T

SusieT

Personally I would be starting at 20% and seeing what they come back with. Hopefully that will make them reply with what they would take and you can negotiate from there, you can always go up but if you start higher you cannot then think oh no I want to pay less.

Good luck with it.

gargrave50

I would suggest they are unlikely to accept an offer of 20%, put in your offer letter the % your offer represents of the ACTUAL amount owed, not the current balance which is the result of endless charges. Start at 30% of that, and be willing to negotiate up to 50%. Just a suggestion .

Stevev99

Having done this a few times in the past, as each yearly bonus dripped in, my standard was to offer about 40% off the debt since this is usually the maximum they'd offer. This did work a few years ago.

Saying that, with all the credit crunch stuff going on now, companies are clearly squeezing as much out of bad debtors as they can and recently I've noticed companies are offering very small figures like 5-10% or with credit cards if your agreed payment is above the usual monthly amount, then nothing at all.

A lot seems to depend if the debt is past the default stage and with recoveries still (which can mean a better reduction) or has been passed to a debt recovery company who tend to offer lower.
If you're simply in a payment arrangement with a company and they haven't defaulted you (which happened with 2 of mine) they tend to offer no reduction.

Taking all that into account and if you think there might be flexibility, start with a high % reduction in my book and let the bartering commence.

Good luck...