Consolidation

oliviatwist

Hi,

I'm in a position where I can pay off some/all of my debts. Most are with debt collection agency's now. Like Lowell etc.

I've read about people paying a percentage of the total off. Does this further negatively affect your credit rating or is it considered fully settled?

How much do you offer to start?

Thanks in advance

HappyMJ

oliviatwist wrote: »

Hi,

I'm in a position where I can pay off some/all of my debts. Most are with debt collection agency's now. Like Lowell etc.

I've read about people paying a percentage of the total off. Does this further negatively affect your credit rating or is it considered fully settled?

How much do you offer to start?

Thanks in advance

It will most probably show as partially settled. Settling the debt in part will improve your credit prospects but you will still have a default on your credit report. Your credit will not improve until that disappears which takes 6 years from the date of default...not the last payment.

Depending on the age of the debt depends on how much you should offer. If the default has already dropped off your credit report then offering 20% of the outstanding amount would be a good start. If the default is less than 6 months they probably wouldn't accept much less than 90% of the outstanding amount.

You started by saying "consolidation". I hope you haven't taken out an interest bearing loan to pay the debts that are not charging you any interest off. That will make your credit worse.

oliviatwist

Thanks that was exactly what I wanted to know!

I am fortunate to be able to borrow a large amount off a family member so no silly fees.

I can probably get the full amount and pay everything off in full - if that would look better on my credit file?

Some of the debts are a few years old, others are newer

sourcrates

oliviatwist wrote: »

Thanks that was exactly what I wanted to know!

I am fortunate to be able to borrow a large amount off a family member so no silly fees.

I can probably get the full amount and pay everything off in full - if that would look better on my credit file?

Some of the debts are a few years old, others are newer

Never pay the full balance on already defaulted debts.

There is always a deal to be done, test your negotiation skills !!!

oliviatwist

sourcrates wrote: »

Never pay the full balance on already defaulted debts.

There is always a deal to be done, test your negotiation skills !!!

So seeing as my credit rating is already really terrible... Would only paying my debts off partially do much more damage?

sourcrates

oliviatwist wrote: »

So seeing as my credit rating is already really terrible... Would only paying my debts off partially do much more damage?

Can't get worse than a default, settle for as little as possible.

Defaults last 6 years an they ain't bothered how much you paid !!!!