F+F settlement/credit rating (Barclays)

kjp

Hello all

Posting on behalf of a friend of the family, I've used tonnes of advice from this website before so thank you all!!

She and her husband are currently estranged with a view to divorcing in the near future. He has c. £30k worth of debt on credit cards, is unemployed and has no way to pay these back (nor feels they are a problem at the moment, unfortunately). All of the cards are in his name. There is a joint barclays account with an unauthorised overdraft of £1.3k, my friend contacted barclays in November when he left to say they were unable to make payments and the account was closed so he couldn't access it and wrack up anymore debt. Thankfully, Barclays have accepted a token payment of £1/month and have stopped interest/charges.

We sent a full and final settlement offer of £500, they came back with. £1k, we offered £600 and they've come back with £700 which will be marked as partial settlement. My friend doesn't reAlly want to pay this off but as she is liable I have offered to gift her the money.

Other than this joint account and mortgage, they have no other joint accounts. She has a tesco credit card which she uses and pays off monthly and hasn't misSed any other payments.

So, questions!
1) 'partial settlement' is normal (the letter says full and final) - she won't be chased for the difference?
2) I'm assuming the account has defaulted, what's 'better' for her credit score, a partial settlement or ignoring it?
3) if her husband is able to pay off the remainder of the debt after the full and final settlement has gone through, can this be updated on her credit score?
4) the house will shortly be going on the market. There should be enough equity to buy a smaller house for her with a small mortgage, she appreciates her choice of mortgages will be limited by 1 and 2, but if the joint account is closed, their financial ties with the mortgage is separated, and she applies for a disassociation of their credit scores, will any defaults he has received up until that date on cards in his name affect her credit score, or just the defaults on the joint account?
5) the settlement letter from barclays was addressed to her and had her reference on, but the 'dear mrs so and so' was addressed to 'dear mr someone else entirely'! Should she raise this with barclays or anyone with regard to data protection etc... It's only a surname but still a tad worrying!

Thank you in advance for any help you can offer, it's been a very rough few months so anything I can suggest to ease the strain will be gratefully appreciated.

Kxx

happy_bunny_2

1. Yes. This is normal from a credit file reporting point of view. Important the letter says full and final or it states the account balance will be set to zero.

2. Partial settlement. The default will still be a major issue, settled or not. It will prevent a potential CCJ by paying it.

3. Once joint debts are paid. She can file a notice of disassociation with the CRAs, so any other debts he has will have no impact on her.

4. Just the default on the joint account. May be able to get a mortgage via a broker. Check on the mortgage board.

5. I would want the letter correcting before paying. In case it's required in the future for any reason.