Final settlement help needed please

crazycatgirl

Hi everyone,

I've got around £10-12k of debt, spread over 4 credit cards. I'm soon going to inherit enough (hopefully) to pay them all off, but I want to negotiate to get the best settlement. I have no idea how to go about this, as I'm not using the services of any professional organisation at the moment, I'm managing them all on my own. Obviously, I need to look into exactly how much I owe each debtor and find out how much my inheritance is, but once I know, is it best to phone them or write to them? Would I need to speak to a manager or would a call center operative be able to give me the best deal? I'm worried about calling up and agreeing to a high figure if I feel pressured into it and not offered anything better. I'm so happy to be in a position to be able to pay off my debts and I'm happy to take responsibility for my poor life choices in the past, but I do resent the crazy interest I've been charged historically and I would love to have a little money left over when it's all sorted out.

In case it's useful here's a bit more background info:
My debtors are: HSBC (30%) Lloyds (30%) Natwest (20%) MBNA/Recovery Agency (20%)

I started getting into debt when I moved out of home back in about 2002 and my rent, bills and household shopping exceeded my income. They gradually built up until in 2008, when I finally got a job that paid me enough to start paying them back over the minimum. I became debt-free for a year or two and then was made redundant and I was plunged back into debt, having settled for a poorly paid job and a boyfriend who wasn't earning much either. In 2011 I got my first rejection for a credit card balance transfer, which was my turning point. I took my head out of the sand and called Stepchange. I went onto a payment plan of £1 per debtor per month. Less than a year later Stepchange stopped managing my debt, as I missed a deadline to review my circumstances. I then landed a really well paid job on a one year contract and paid a few hundred pounds a month to my debts. At the end of the year I was expecting them to be massively reduced, but I realised that Lloyds had continued to charge me a huge amount of interest, so I hadn't made nearly as much of a dent as I'd been hoping to. My next job paid a lot less, so I had to reduce my payments. I wrote to all my creditors and they all stopped charging me interest (although I think the only one that hadn't already was Lloyds). I thought about bankruptcy etc and sought some professional advice, but decided it wasn't for me. I was then paying £4 each to Natwest and MNBA and £6 each to HSBC and Lloyds, per month. In November last year I landed another better paid job and I increased my payments to £40 and £60 per month, which is what I'm still paying now. So I think I have a reasonable record with my debtors, as I have kept them informed of my circumstances and written to them when things have changed. I may not have made all of my payments 100% on time, but I don't think I've missed a payment in at least a year. My next step (once I stop procrastinating) is to check my credit report!

I would love to hear any/all advice you wise guys have to share with me

Amy

National_Debtline

Hi Amy

crazycatgirl wrote: »

Hi everyone,

I've got around £10-12k of debt, spread over 4 credit cards. I'm soon going to inherit enough (hopefully) to pay them all off, but I want to negotiate to get the best settlement. I have no idea how to go about this, as I'm not using the services of any professional organisation at the moment, I'm managing them all on my own. Obviously, I need to look into exactly how much I owe each debtor and find out how much my inheritance is, but once I know, is it best to phone them or write to them? Would I need to speak to a manager or would a call center operative be able to give me the best deal? I'm worried about calling up and agreeing to a high figure if I feel pressured into it and not offered anything better. I'm so happy to be in a position to be able to pay off my debts and I'm happy to take responsibility for my poor life choices in the past, but I do resent the crazy interest I've been charged historically and I would love to have a little money left over when it's all sorted out.

Amy

If you're making any sort of lump sum settlement offer, you really need to be doing so in writing, or at the very least getting explicit written confirmation from your creditors that they accept your offer and that they will update your credit file accordingly. Their telephone staff will often not have the authority to agree such settlements in any case.


You could do worse than look at our guide which includes letter templates for making such offers:


https://www.nationaldebtline.org/EW/factsheets/Pages/fullandfinalsettlementoffers/lumpsumoffers.aspx


Dennis
@natdebtline