Does anyone have experience of offering a lump sum for final settlement of a loan?

duckeggpinecone

If so what is a realistic amount to offer? I have heard of people offering a lump sum to creditors in order to call an end to the loan.

We are not being bothered by the creditor and don't want to stir things up whilst we are sorting out our financial situation. What would be a realistic amount the a creditor would accept for full and final payment of a loan?

It has been about 7 years and they haven't been recieving any payment from my husband for the loan.

many thanks in advance for your help.

HappyMJ

7 years and no payment been received in that time. I'd offer nothing. There's nothing the creditor can do to enforce payment.

foxy-stoat

If the debt is unsecured, do nothing - you have won !

Gaz83

Has the loan been acknowledged in that time?

If it's not, then technically you don't need to do anything. If it hasn't been acknowledged (in writing) or you haven't made any payments it's statute barred.

There is of course the moral argument that you still owe this money, and might like to pay it back (or at least a chunk of it).

There's also the case that although the debt can't be pursued it still exists, and the lender will probably refuse to lend you again while it is still outstanding.

foxy-stoat

Pay £1 today, and they will start chasing you for the full amount for the next 6 years !

Angry_Bear

Just in case you need some context, the rules (in England and Wales) are that if you haven't acknowledged - in writing, or by making a payment - a debt for a period of 6 years, then it becomes "statute barred".
This means that a creditor can't take you to court to make you pay, and if they ask you to pay and you say "no, it's statute barred and I'm not going to pay it", they aren't allowed to keep harassing you.

If they do get in touch, there are template letters to send that basically say "no, it's statute barred and I'm not going to pay it".

foxy-stoat

https://forums.moneysavingexpert.com/discussion/5320982

According to this post the £35K was taken out with Nemo finance - was this secured on property and is this the debt you are talking about?

duckeggpinecone

Yes that is the debt. We have had a credit report via post as my husband doesn't have a visa card to get an online report. The only thing that shows up is the Nemo Finance loan for £36,510 and £10 for a Barclays bank account which was closed.

I forgot to add my husband has a CCJ for this debt starting from 10th March 2010 and will expire 10th March 2015 according the the credit report. Will Nemo take him back to court to apply for another CCJ? Crap i've just read it can only be statue barred if there hasn't been a CCJ in the last 6 years!

My husband had his flat repossesed in 2008 as he couldn't pay the mortgage. He said he is not sure if he got the loan out on the mortgage he thinks so. I wasn't living with him at this time and totally unaware of the mess he had got himself into!

About 3 years ago a man came round to financially asses the household to see if we could afford to start making payments, at that point we were not able to make payments. He suggested a token guesture of £1 but my husband never set this up. Would this count as aknowledgment?

If the debt is statued barred how would this affect our prospects for the future getting a mortgage? The debt is still there right? But there is no obligation to pay it?


I am confused!

Angry_Bear

duckeggpinecone wrote: »

I forgot to add my husband has a CCJ for this debt starting from 10th March 2010 and will expire 10th March 2015 according the the credit report.

CCJ's don't expire, and your debt wont be statute barred if you've got a CCJ.

About 3 years ago a man came round to financially asses the household to see if we could afford to start making payments ...

Sadly not a good sign, as it means that your creditor hasn't forgotten or abandoned chasing the debt. If they left it more than 6 years after the CCJ without trying to enforce it, they'd have a problem, but it sounds like they have been trying to enforce it.

Would this count as aknowledgment?

Acknowledgement is irrelevant as your husband has a CCJ.

If the debt is statued barred how would this affect our prospects for the future getting a mortgage? The debt is still there right? But there is no obligation to pay it?
I am confused!

You will have a very large, unsettled CCJ showing on your credit report. It will make it extremely difficult, and maybe impossible (although worth speaking to a good broker) to get a mortgage, even more so as it results from a repossession.

Clive_Woody

duckeggpinecone wrote: »

Yes that is the debt. We have had a credit report via post as my husband doesn't have a visa card to get an online report. The only thing that shows up is the Nemo Finance loan for £36,510 and £10 for a Barclays bank account which was closed.

I forgot to add my husband has a CCJ for this debt starting from 10th March 2010 and will expire 10th March 2015 according the the credit report. Will Nemo take him back to court to apply for another CCJ? Crap i've just read it can only be statue barred if there hasn't been a CCJ in the last 6 years!

My husband had his flat repossesed in 2008 as he couldn't pay the mortgage. He said he is not sure if he got the loan out on the mortgage he thinks so. I wasn't living with him at this time and totally unaware of the mess he had got himself into!

About 3 years ago a man came round to financially asses the household to see if we could afford to start making payments, at that point we were not able to make payments. He suggested a token guesture of £1 but my husband never set this up. Would this count as aknowledgment?

If the debt is statued barred how would this affect our prospects for the future getting a mortgage? The debt is still there right? But there is no obligation to pay it?


I am confused!

If you have an unsettled CCJ for £36,510 I suspect you are really not going to get a mortgage, unless you are not financially linked with your husband (i.e. a joint account, joint loans etc) then you might be able to get a mortgage on your own (assuming this is affordable).

If you have money available to pay off a lump sum then it might be worth considering asking them for a settlement figure to start trying to sort out his credit file. As far as I understand a settled CCJ looks better than an unsettled one.

As mentioned because they have a CCJ this will not become statue barred so avoiding contact gains you nothing.

duckeggpinecone

Firstly can I say a big thank you for your replies, your experiences and knowledge is invaluable!

I wouldn't expect to get a mortgage whilst the debt is there and wouldn't dream of applying for one. It is something we re looking towards for the future, building OH credit history is also part of this plan.

We have every intention of clearing the debt and then saving for a mortgage so this is all preparation for a debt free future. I am studying the last year of my degree and then will be able to look for full time employment instead of part time (we have a 7 year old so it works around school times at the moment too). I don't have a joint account or loan with my husband.

My only concern now is when the CCJ expires in March 2016 will this prompt Nemo to reapply for a CCJ thus damaging OH credit history for another 5/6 years. As I said I don't want to stir the pot up if not necessary giving us more time to save the lump sum to offer them.