Full and finals

NM2012

I hoped to ask some advice on full and finals. We'be been looking into this approach for a couple of weeks but then weirdly one of my partner's creditors has offered out of the blue a full and final of 50%. They will put it in writing and credit file will be marked satisfied. Although we're struggling to pay he's not in default so it seems like a good offer. But the national debt line are advising we don't accept unless we can offer to pay all the creditors 50%, which we can't... Furthermore they're obviously advising that doing it all in writing is a lot safer. We could probably find enough to offer them all around 35% (by begging from family) so we could pursue this but turning down an offer from one of them seems madness.... Thoughts? Any help appreciated.

fermi

There can be reasons for wanting to settle all at the same time.

For example:-

- If you may need to enter a DRO, bankruptcy or other form of insolvency in the near future, then you have to make sure you have not preferred some creditors over others. Making F&F with one creditor and not others won't always count as such a preference, but even if not it could cause some bother.

- If another creditor sees that the debt is settled (via credit file etc) then they may call foul and make things more difficult, and or take action that they might have not, assuming that you may well have funds you weren't disclosing.

I would ask the NDL rep to explain their reasoning in your case. See if it sounds reasonable.

National_Debtline

Hello NM2012,

Although the usual route when dealing with creditors is to ensure that they are all made pro-rata offers in circumstances like this you can make exceptions. The reasoning is that the 50% offer will significantly reduce your overall indebtedness. If you can clear this particular debt you should then be able to make a higher monthly offer to the remaining creditors (if they are not wanting to accept a full & final settlement themselves).

Sorry to learn that the advice given was contary to what we've just written. Whilst the general rule is to ensure all creditors are treated the same there can be occassions where a 'common sense' decision should be made - a 50% reduction isn't to be sniffed at!

Best wishes,

National Debtline.

r_lewis

hi can i start a saving acount on line after a

Stewart_78

If you can afford it and you want to do it, then do it. Don't worry about what your other creditors think. Maybe they should have made a similar offer sooner? What are they going to do about it? Nothing is what.