Settlement with no defaults.

cookie78

Some advice please. Can you offer a Credit Card company a settlement if you have no defaults on the card. The story is that my partner has MBNA £11,300 and Barclaycard £6,700 owed, both of these accounts regularly go over the agreed limit and have over limit fees for doing so however each card always gets at least its minimum payment. She has told her parents of the mess and they have said that if the CC companies will accept a lower amount then they would have around 9k they could give her to offer them. If she was to offer MBNA say £6k and Barclaycard £3k to settle the accounts does anyone know the liklehood of acceptance? Her parents are willing to help which is great but they want the accounts closed as a condition of doing so.

pqrdef

If it were that easy, it'd be the best moneysaver ever and we'd all be doing it.

grumbler

Even after the credit history gets trashed with defaults I think 50% would be an over-optimistic expectation.

cookie78

OK so if 50% is unrealistic then is it a possibility at a higher % rate?

CLAPTON

cookie78 wrote: »

OK so if 50% is unrealistic then is it a possibility at a higher % rate?

the price of a reduced settlement is a default on her credit files.

she needs to default first over several months and then they may (or may not) accept a reduced settlement

as already said if we could all reduce our debts with no penalty then many would do so.

_Andy_

cookie78 wrote: »

OK so if 50% is unrealistic then is it a possibility at a higher % rate?

But they haven't got a higher amount.

Bottom line here is it's not going to happen

fozmcfc

If they are regularly going over anyway, then your partners credit status could well be trashed anyway.

I would either get the free trials from Experian and Equifax or get your £2 paper reports from the credit reference agencies and see what they say.

Credit cards can be closed, even with a balance, but you still need to pay the remaining balance off at the APR rate at the time of closure.

So if your partner did get £9k, they could pay it towards them, then close the accounts, ask for it in writing and show to the parents it's done.

Then they will need to tackle the remaining balances.

The alternative is to basically default on them, which would definitely trash your partners credit for at least 6 years and see if they will eventually accept reduced settlements.

Other options default on them and then go for a DMP with stepchange or Payplan. Again credit status is trashed, but your partner can set up a repayment plan which eventually means they will be cleared.

I would either post yourself or get your partner to post in the debt free wanabee section of the board for further advice on the debts.

pompeyred

Would your partners' parents offer the £9,000 in return for your partner surrendering the cards to them and them your partner work hard in clearing the remaining balance. The £9,000 will make a significant dent into the balance while reducing the interest.

This should leave a much more manageable balance to pay off.....?

CKhalvashi

pompeyred wrote: »

Would your partners' parents offer the £9,000 in return for your partner surrendering the cards to them and them your partner work hard in clearing the remaining balance. The £9,000 will make a significant dent into the balance while reducing the interest.

This should leave a much more manageable balance to pay off.....?

I must admit, I hadn't thought of this, and this is one of the better ideas I've seen today. (I saw the thread last night, and commented now)

CK

happy_bunny_2

If you don't mind getting credit file trashed then don't pay for several months, let it get sold, no interest, agree payment plan. Risk CCJ, but no high interest rates.

If taken out pre April 2007 CCA them. No have, no CCJ possible.

They won't accept a partial offer before default, they are earning interest, so why would they?