Paying off debts in f&f: What to be aware of

Poten

I have a 2k outstanding debt with Amex, currently paying £60/month. I am in a position to pay this off in total and am wondering what to ask for or how to go about it. Should I bother negotiating and asking for a small discount? To be fair, they froze interest straight away when I asked so I feel I've been treated fairly (especially compared to my other debt with natwest below). They have tho been marking my account as arrangement to pay for the last 2 years instead of defaulting me. Should I specifically mention that they can't default me after paying it all off? (Can they even do this?) Is it more beneficial for the AR markers to be removed and a default added (with a date of 2 years ago)?

I have a 1.6k debt outstanding with Natwest. They have treated me terribly so less inclined to pay it all. I've raised a complaint for charges added (£400) and intend to take it to the FOS if I don't hear from them. They initially defaulted me 2 years ago but upon checking recently this has changed to one year of AR and a default one year ago which is incorrect. Shall I let my complaint go through and then make it a condition of payment in full that they updaye this?

Any general stuff I'm missing that I should mention when paying the debts off?

Arleen

Well, if you are in position to settle in full them you have the negotiating advantage, although I find that asking for a discount will not get you far because why would they (especially in case of Amex who already froze the interest)? So just go, pay it in full and be thankful for freezing the interest.

As for natwest since I imagine that you still pay the interest on the account then paying it on asap basis will stop the interest from accruing, which is good. And I would say that there is little rush in fixing your file, as with two entries like that you won't be eligible for credit anytime soon, so saving on interest would be my priority.

Poten

No interest on the natwest debt. I've already been defaulted and I assumed it was standard that the interest is frozen at that point during a repayment plan.

I can see your point with Amex and, as I said, given I've been treated reasonably, I'm happy to pay them off in full. But I'm worried about them defaulting me after I've paid so want to be aware of any potential gremlins before I go ahead with this plan.

Natwest I pay £13 per month so it would take 10 years for them to get the full amount back. That's their incentive for reducing the amount for a f&f.

Arleen

Not really, they have all the time in the worl to wait for the money as they are not going anywhere, and doubt that they are strapped for 1.6k. And if at any point during that period you will stop paying they can go and get a CCJ against you, ruining your credit file again.

National_Debtline

Hi Poten


In my experience, the likelihood of a creditor contemplating a lump sum settlement will rise significantly if/when the original lender passes/sells the debt on elsewhere - this would normally only happen after the account has been defaulted. So, by all means explore this with Amex and Natwest but don't necessarily expect anything from them.


Dennis
@natdebtline

Poten

Natwest have passed the debt on to two other firms already. But I think this whole thing is a bit of a tangent.

What I really care about is if I pay in full what should I ensure they agree to beforehand? Once I have handed over the payment I lose all bargaining power so I want to make sure I get things arranged before. Eg. Usually people making partial payments are advised to get it in writing that the remainder of the debt will not e pursued or sold on prior to paying as this protects them later. Anything like that I should be aware of?

Poten

Spoke to the company who hold my debt (NCO) on behalf of Amex. They sent me a letter which states:

"Once the final payment has been made the account will close and will be sent to American Express who will arrange for your credit file to be updated within 6-8 weeks to reflect the satisfied status"

Firstly, is there a difference between 'satisfied' and 'settled'? I have read that 'settled' means paid in full whereas 'satisfied' means different. I intend to go back and ask them to explicitly state "fully settled" as the wording used leaves it open to them to mark it partially settled.

Secondly, is there an issue that they are making a promise about what a third party will do in terms of updating the credit file? I was of the understanding that NCO were a part of Amex but still I can see something going wrong and amex using the "we didnt promise anything" line and NCO using the "its not in our power" line.

Poten

Bit of a bump really.

Before I pay this 2.1k debt off, is there any difference between 'satisfied' and 'settled' on a credit report? Should I ask for it to be marked as 'settled'?

Any help would be massively appreciated

TheDebtinator

Satisfied tends to mean not paid in full. Settled means paid in full.

Poten

Thank you for the reply!

The interest on the account was frozen about 2 years ago when I ran in to problems. The account has been marked as AR (arrangement to pay) and I will have paid the full amount, minus the possibly interest of course but I dont think that is normally taken in to account.

If that is the case, do I have a good argument for asking them to mark it settled, not satisifed?

TheDebtinator

Its marked as satisfied rather than partially satisfied, tbh it doesnt get much better than that and I wouldnt worry. Any lender looking at your file would see that you paid the full outstanding.