Full and final settlements refused - thoughts please?

1981trouble

I have been on a dmp for 6.5yrs, projected time is 20plus year left.

I recently approached the debtors with a view to making f&f settlements (offered money from a relative to cover it). I went in very low about 20-30% and was expecting rejection. I can push to 50% at most.

I got rejection! However, 4 of the debts have written back and stated they are not prepared to consider any f&f offers at all. (Two are with the original debtors and two been passed between many many agencies).

The others which did reply have counter offered 75% payment.

So, I guess I am looking now for thoughts about whether it is worth pursuing this or just keep paying each month, as they seem to have set their thoughts clearly out.

Tixy

Its not unusual for original creditors to turn down F&F offers (unless you catch them just as they are preparing to sell your debt).

With the other debts, have you ever tried doing a CCA request to the debt collectors to ensure they hold the correct paperwork for your debt? (for those accounts that would have a CCA that is)? If they cannot produce the paperwork then they would likely be much more open to low F&F offers.

Failing that and given the very long predicted timescale - have you spoken to your DMP provider about considering other options for you - perhaps considering an IVA or bankruptcy? Is your DMP provider one of the charities/free providers?

Monkeyballs

Hi,

Like Tixy said

Also, you've not mentioned what your payments are? If they're high then it's still probably worth your creditors while in just waiting it out...

As for those who countered with 75%, that seems fairly standard (and could indicate that the debt is still with the original creditor and they've not sold it but have a 3rd party collecting on their behalf) so up your bid a touch and mention that as it's an offer from a relative that you need a sharpish reply

Out of curiosity, who is your DMP with?

MB

Atrube

Hi,

Not sure if I'm right here, so would be interested to know what more experienced people thought, but if you are maintaining your payments each month without any hiccups, then lenders are less likely to want to settle.

However, if the debt is over 6 years old and no longer showing on your credit file, then wouldn't it be better to start missing a few payments etc?

You don't want to get further into debt, but if you know you can make a realistic settlement offer, then I would have thought you need to cause the creditors some aggravation and 'draw them in', by not making it so easy for them. If they have to keep writing letters etc, I would have thought they would be more inclined to look at a settlement.

May take 3 - 6 months but worth a go?

System

usually 75% is the lowest they'll go

Stewart_78

prettynfun22 wrote: »

usually 75% is the lowest they'll go

That's not correct at all. There are a lot of things to consider but offers of 20-30% are often accepted.

Atrube

prettynfun22 wrote: »

usually 75% is the lowest they'll go

I've heard of people getting much larger discounts than this.

chiefsfanuk

There are many more experienced here that I, but I just thought I'd mention when I offered F&F settlement to some lenders about 6 years ago I had the similar 75% counter offer and went back to them saying it was 50% or I'd be looking at an IVA and they snapped my hand off at the 50%. I'd suggest a counter offer with these lenders at least.... Unless of course other options for your debt mentioned above turn out to be more suitable.

longtermplanner

20 years left is unrealistic for a DMP. You must be making low payments. Do you have a house with a lot of equity? If you do, then your creditors will be reluctant to accept a low F&F ever.

You need to look at your other options: selling the house, remortgaging (if you can get a decent rate), DRO (if debts under 15k and no house), IVA, bankruptcy.

Lensman_2

You need to lower their expectations.

Do a CCA request for each debt that is not an overdraft or secured.

Come back in a month or so when most of them have failed.

1981trouble

I did cca stuff a few years ago and removed a few debts then. The remaining do have the paperwork.

I am self managing the dmp (was with pay plan and then took it over myself). Started paying £240 on £25000 debt. Mixture of ppi, cca arguments etc and i am currently paying towards about 6k of the debts remaining, I pay £50 a month currently. (Decreased over the years due to change in jobs/maternity leaves/childcare etc)

Just realised, I had mis typed in my op - I will be paying until 2024 not for 20yrs.

Most are off the credit file now. Recently sold the house so no equity and now in rented until we can clear this lot and be back in a position to buy again.

I think all comments so far are things I have thought about so now others are saying them too I will evaluate them in further detail. I must admit, the ones totally refusing to consider any offers threw me, I naively just assumed they would all consider something given the timescales.