When to pay back debts? And settlements and default removals advice

jonnym8083

I have around £5k of debt across 7 creditors and I am currently in a dmp some creditors have given me defaults. I have seen some sample letters in order to try and get them removed.
In a nutshell I have recieved some money that can pay these debts. I want to offer them settlements but what percentage do I offer also on basis debts are fully satisfied/settled and defaults removed..

What's the best way to start shall I stay on dmp and try and get defaults removed first before offering settlement or shall I pay off and then try with default removal?

Any advice would be great

Kate_fixing_it

The defaults can only be removed if they are in error. If you did fall behind in payments you have defaulted and it's an accurate record. They will fall off your file 6 years after they were added.

in your situation I'd try some full and final settlement offers to get the debts cleared and free up some income.

Kate x

jonnym8083

Why full payments rather than part if I can get dicount? Is partially satisfied worse that satisfied? By paying back all debt will I see an increase in credit rating

Kate_fixing_it

By full and final settlement I mean paying less than you owe but that is considered as full settlement by the creditors. Each will vary on what they'll accept but it's open to negotition. You will need to get their agreement in writing to avoid any repercussions in the future.

By paying back the debts they will show as satisfied on your credit file but they will still show for 6 years from the default date.

Are you considering taking out more credit that needs your rating to improve?

Kate x

double_mummy

jonnym8083 wrote: »

Why full payments rather than part if I can get dicount? Is partially satisfied worse that satisfied? By paying back all debt will I see an increase in credit rating

yup because your showing companies who are looking at your credit file that you aren't paying all your debt back so being partially satisfied is better than a default but is worse than satisfied

jonnym8083

Well yes I have received inheritence so I will looking to get a mortgage

Cloudy456

Not being funny, but if you've come into money why are you not just paying what you owe. Presumably you spent the money to build up the debts, yet you're trying to get away with paying less. As I understood it, offering a full and final settlement would be something for situations where people cannot, and have no realistic hope, of paying back what they borrowed. You're not in that situation and quite aside from the moral aspect of it, why end up with another black mark on your credit file? Just my thoughts anyway, I know many will disagree and say pay the minimum you can get away with.

jonnym8083

Well I have had offers from creditors already. That's the question I'm askin difference between paying less or more in regards to full satisfied to partial?

rizla_king

No harm in trying. Everything you get off is a bonus.

Kate_fixing_it

https://forums.moneysavingexpert.com/discussion/4874045

OP - you asked the same thing two months ago. I don't wish to be rude but the advice won't have changed. The only thing that will repair your credit file is paying the debt, time (for defaults to drop off) and a clean credit history going forward.

Kate x

jonnym8083

Thanks for all advice guys I'll pay off in full I think as only 5k in full and if it says it full satisfied that be ace plus shouldn't need much of a mortgage anyways so should be ok with 60-70% LTV to get that in maybe year or so