ERUDIO student loans help

thin_king

Thanks Fermi - you've been very helpful this afternoon - much appreciated - I think its best to speak to my broker about partial flags and their importance to my mortgage lender!

fermi

If you want to know for sure, that would be the safest way.

halfpricedebt

Got some interesting info from the National Debtline regarding partial and full and final settlements.

Something didn't sit right with me about handing over a large amount of money to Erudio so I spoke to a specialist at National Debtline.

So, essentially because of the CCA, we are within our rights to make a full and final offer to settle the account and a reasonable figure is 30%. This is based on my account though so if you want to check I would advise speaking to them yourselves.

What I was told us that if I use their template for a full and final offer then Erudio have to respond in writing with what they are willing to accept. The key thing is they have to state they accept a full and final offer, not a partial. Full and final means they can't go back on the agreement years later and have to mark the account as "satisfied" which arguably isn't as damaging as "partially settled" for your credit rating. National Debtline were really helpful and it sounded as though they are fully aware of Erudio's practices - as are the financial ombudsman. It seems they are not getting themselves a good reputation.

You can also find out more about effects on your credit rating by contacting the Money Advice Service.

I'm going to make the payment due on the 10th and then send them a letter by recorded delivery outlining the full and final offer. Thought people might find this useful.

halfpricedebt

Oh and I meant to say - full and final settlement is different to partially settled. Should be obvious but isn't.

Also, if they agree to it in writing you keep that letter in case there are any questions about it in the future.

Erudio can't go back on it if they agree to the conditions of a full and final settlement. Full and final includes a stipulation that they can't report you to CRAs for default etc. if they accepted the full and final then the account is closed.

thin_king

Forgive my lack of knowledge here but what does CCA stand for??

thin_king

plus have you got a link to the template?

thin_king

found it :-) https://www.nationaldebtline.org/EW/factsheets/Pages/24%20EW%20Full%20and%20final%20settlement%20offers/Page-04.aspx#

fermi

Full and final refers to the legal liability for any left unpaid. Not how credit files are marked.

The NDL person you spoke to got the distinction between those 2 wrong.

Even when accepting a full and final offer, they are not obliged to mark credit files as such. Unless they specifically agree that.

It can still be marked with a partial flag as that distinguishes the settlement from one where it was actually paid in full.

There is also nothing in the CCA (Consumer Credit Act) that requires a creditor to consider an offer.

halfpricedebt

Ah yes Fermi. I think you are right.

I think the gist is that because of the consumer credit act we can make full and final offers. Erudio don't have to accept it but an offer can be made. If part of the full and final letter says that by accepting they agree it can't be reported to CRAs then that takes the p flag out of the running. I'm going to speak to the Money Advice Service this afternoon to get more clarification on this.

halfpricedebt

I meant to add that they also told me that because there are now more people defaulting, suffering CCJs and a multitude of other debt troubles, those who give loans tend to take all of that into consideration so it doesn't always mean you will be refused a loan. But again, I think it's better to speak to the Money Advice Service about finer details because apparently they can give more robust advice.