I owe Lloyds £1,000 from an old overdraft...

On_my_way

...the account is in default as when I joined my DMP in December 2009 I was advised to get another bank account.

Recently I asked the DMP company for a F&F figure but I was quoted £700. I know it's cheeky, and I did use the money (domestic violence against me from my ex meant that I let him take me to the cleaners financially) but what should I be offering?

I thought I would be able to get a 50% discount? I have been paying them all this time although the O/D only started at £1,200 so they have had just a few pounds a month.

Thanks,

:j

Tixy

Do you mean you asked your DMP provider to ask the creditor what % settlement they would take on the debt?

Is your DMP provider a commercial one who take a monthly fee? if so they may well be adding a fee to settlement offer given by the creditor.

If you are wanting to settle just one debt from a DMP then it is best to write to the creditor directly yourself and offering what you can afford to pay.

Very difficult to say what % they may accept as it depends on such a lot of things. Is the debt still with the bank or with a debt collector? How long is your DMP currently forecast to last?

On_my_way

Hi Tixy,

Sorry, I should have put more information in my post!

I am with Debt Advisory Line (who no one mentions here which is scary but they have been fine). I told them that my mother would be able to provide 50% of the debt to Lloyds to clear it. They do add their fees but they said Lloyds would only allow £700 plus then their fees which are 30p in every pound that they save me.

I was expecting a figure of more like £500 including any fees.

The debt is now with their own collectors, can I still approach them directly?

The DMP is forecast to finish in December 2015

Tixy

Yes you can approach them directly and will very likely get a better deal negotiated with the creditor.

I would send the creditor/collections team an offer letter using the national debtline information & template and set your offer at a rate you can afford. General advice is to go in lower than the max you can afford so you have room to negotitate. https://www.nationaldebtline.org/EW/factsheets/Pages/24%20EW%20Full%20and%20final%20settlement%20offers/Default.aspx

If you do agree a settlement and pay the debt off then just go back to your DMP company and say that debt had been paid by a relative and to redistribute your monthly payment excluding that debt.

I am sure you have had this advice before, but I would definitely also ditch using DAL (who do get mentioned on these forums but rarely in a very postive light) and either self-manage your DMP for the next year or consider talking to one of the free providers.

On_my_way

Thanks Tixy. I will use that link and approach them myself. To be honest, when all this became too much for me in 2009 I wasn't on here and I had no idea where to turn really. My parents have never, ever been supportive of me around any of this.

I will call Step Change and see what can be done. I pay £300 per month so it's not like I don't pay it..but it's taking forever!