Full Final Settlement - Emigration

Saviola

Howdi,

I am after some advice, or opinion.

I am emigrating at the end of the year and would like to if possible clear my debt before I leave. I have done the maths and I can afford to pay off about 70% (£14000 on CCs) of my current debt and still be able to make the move comfortably, job and initial accommodation setup.

I have never missed a payment and overpay frequently, so do you think my creditors (MBNA, Halifax) would accept a full and final settlement?

I have been told, by a co-worker, that I would probably need to stop paying them now and ask in 3-4 months time for them to accept.

I know its not morally right to skip out on the debt.

Any thoughts?

Thanks
Saviola

Tixy

It is very unlikely that your creditors will accept any reduction to the full balance if you are up to date with debts/not defaulted and they are still charging interest.

Even in 3-4 months if you stopped paying it is quite likely they still won't consider reduced full & final settlements.
Creditors do sometimes accept reduced settlements, that is usually when the have frozen interest on the debt, don't believe that court action would result in them recouping the debt any quicker and are nearing the point of considering selling the debt off to a debt collector.

TBagpuss

are you in a payment agreement, or are you just talking about your normal usage?

If you are in an arrangement then they may be prepared to accept a lump sum now rather than getting a small amount every month for the next 10 years.

Otherwise, why would they accept less that you owe them, and why would you think it is reasonable to ask them to? pay off as much as you can, and set up regular monthly payments to clear the balance as soon as possible.

When you say that you overpay regularly, what do you mean? Are you talking about paying more than than minimum monthly payment?

molerat

Unlikely to agree to a less than 100% F&F if you are not in arrears. If you do go into arrears and they do not accept an offer depending where you are in the world they may chase you for the debt.

Saviola

Thanks that's what i was basically thinking. I will be in Australia and people who have done the 'bunk' say they have never been chased.

I didn't think it unreasonable to ask considering the extortionate interest they are charging and the age of the debt, my fault I know. No harm in calling them I suppose and see what they say.

I see so many people wipe off all their debt and couldn't care less I imagined offering 70%+ would tempt them. We will see.

eskbanker

Saviola wrote: »

I didn't think it unreasonable to ask considering the extortionate interest they are charging and the age of the debt, my fault I know. No harm in calling them I suppose and see what they say.

They'll probably say "if you felt the interest rate was extortionate then why borrow money from us in the first place?"!

Tixy

If the interest is extortionate have you worked out if it would be cheaper to try to obtain cheaper cards elsewhere and doing balance transfers whilst you repay the debt over the next few months?

Have you tried phoning up and asking if they can reduce your interest on these cards at all (only a slim chance but worth a shot).

Although if you are going to be repaying £10k towards these debts over the next few months the interest charges will obviously soon drop considerably.

Otherwise then pay off as much as you can afford before the move and then you can still set up repayments once you live abroad, and at that point they are more likely to be willing to accept reduced payments if you cannot afford the minimums (although that would then be reflected on your UK credit files).

Australia do have a reciprocal agreement with the UK in relation to debts. Although admittedly they would need to know you were there and find you to be able to use that.

Whilst some people do successfully move abroad without repaying their debts and cease payments there are also plenty of cases of people ending up returning home and finding their credit file still trashed for several years after, and I've seen at least one case of someone who was made bankrupt in the UK by a creditor whilst abroad and that obviously affected them when they returned and found out about it.

Saviola

eskbanker wrote: »

They'll probably say "if you felt the interest rate was extortionate then why borrow money from us in the first place?"!

They may do but it wasn't that high when I took it out. It rose before the ability to refuse interest rate changes, I have not used my CC's in over 3 years, Halifax in over 5 I think.


I cannot move it elsewhere due to low credit score mainly due to current liability. If they say no I will pay off what I can and setup repayments, that's not an issue. Just thought in the age of responsible lending whether they would be open to the F&F

[Deleted User]

Saviola wrote: »

Just thought in the age of responsible lending whether they would be open to the F&F

Responsible lending is exactly why they will expect full payment.

bluffer

Saviola wrote: »

I know its not morally right to skip out on the debt.

so you already know what to do.......

-taff

I've never heard a rich person harp on about morals in money, but I've heard loads of poor people do that.

If you#re leaving the country and not coming back, and it's a country where they won't chase you...I know what I'd do and it wouldn't be pay the debt.