Newbie query re: final settlement

rachie1

Hi,

Has anyone else had experience of this?

I have made a final settlement offer to a credit card company which they accepted in writing. I asked them to record the debt as 'fully satisfied' with the credit reference agencies, however they will only record the debt as 'part satisfied'.

Is this normal and what possible consequences will it have for me later?

Thanks,
Rach

bkclive

Basically 'fully satisfied' means that they have no further claim on you, and the debt is settled. 'Part satisfied' means that they retain a claim on you for the balance of the debt. Strangely even if they accept a lesser amount in full settlement they are still allowed in law to try and claim the balance at a later date! On a practical level very few do because of the cost, etc. The record on the credit agency files will show other companies that a settlement was reached, but not for the total amount owing.
By the way, you can put the words 'Without Prejudice' at the top of any letter offering a settlement/payment, and this means that you keep the right to change that offer. If this term isn't used, then once an offer is accepted it becomes a contract. I found all this out the hard way when I was self-employed.
You could try pointing out to them that this offer was for full settlement only, that it's as good as it can be, and saves them a lot of time,effort, money, etc, so if they record it as fully satisfied then they get the money a lot sooner. Worth a try!

rachie1

Thanks bkclive for taking the time to reply.
I will call them and try to persuade them to mark the debt as 'fully satisfied'.
If they don't then it leaves me with the problem of whether to pay them and take a chance they don't chase me for the remainder of the debt later.
I didn't put 'without predujice' on my letter, but that will help when and I try and deal with the remainding 6 creditors I also owe!
Rach

bkclive

Sorry Rach I didn't emphasise how rare it is for companies to chase a debt once they have accepted a settlement offer. What I was trying to do was point out that legally they have this option, so the term 'full settlement' can have little meaning when it is used by them. What they will do with you is the same as everyone else who offers them a figure they see as reasonable; take it and close the debt. I've never met or heard of anyone being chased again when an offer has been accepted, but it will be interesting to see if anyone on the forum has been. My money is on the "not chased again's" though.

rachie1

Oh I see, so chances are they won't chase me. Thanks for making me feel less stressed. :cheesy: