Partially satisfied on a non defaulted account

elliechoc

Hi,

Just following on from my other thread, as I should get letters next week so am keen to clarify this, I need some advice. I have a debt with Cabot for £2671 and they have agreed a settlement of £2187.

They stressed to me that it would show as partially satisfied , as on my credit report they said they are the only one of my 4 debts now showing and that the account is being marked as up to date and going for partially satisfied would affect my credit. I could however open the account at a later date to pay the rest off if I had problems, say getting a mortgage for example, and they would then mark it satisfied.

Is it better to just pay the full balance for the sake of making my credit score better? I will have to ask for more money from my relative though and as much as they want to help me they aren't overjoyed by this situation.

Thank you.

StokieBecks

The account must be defaulted for it to have gone to a debt collection agency. Have you checked your credit files to see when the original account default date was. I would just pay your settlement figure if you have it confirmed in writing that it will close the account with a zero balance and won't be persued for the remainder. Sounds like they are just trying to squeeze you for the full amount for their profit.

National_Debtline

Hi

It’s difficult to quantify the effect a partially satisfied debt will have if you make a mortgage application. A mortgage lender would interpret your credit file and situation in their own way and there are also various other factors they take into consideration such as deposit size and affordability.

All I can say is that very generally it will not look as good to potential lenders as paying off in full.

Check your credit reference files yourself though if you haven’t already. As StokieBecks points out, we would expect it to be defaulted already if Cabot have bought the debt.

James
@natdebtline

elliechoc

Thank you for your replies.

I have been looking on Noddle and Cabot shows with green circles and the letters DM (debt management) and UC (no up to date information), there is no record of a default on there that I can see.

There is only one default which drops off any day now but that shows as being with HSBC which is with a different creditor.

I have 4 debts which I have agreed settlement figures for, therefore if the Cabot one is the only one showing, am I right in thinking this is the only one that could affect my credit?

elliechoc

Just signed up to Equifax and they are showing there as up to date, and there are no defaults showing at all.

National_Debtline

It’s unusual but it sounds like it wasn’t registered as a default on your credit file then. It’s also worth checking the information held by Equifax. You can check for free on www.clearscore.com

James
@natdebtline

Keezing

How old is the original debt?

You may be able to get the default back-dated. If it is back-dated far enough, partially (or fully) satisfying your debt may be a moot point with regards to impact on your credit rating.

glentoran99

StokieBecks wrote: »

The account must be defaulted for it to have gone to a debt collection agency. Have you checked your credit files to see when the original account default date was. I would just pay your settlement figure if you have it confirmed in writing that it will close the account with a zero balance and won't be persued for the remainder. Sounds like they are just trying to squeeze you for the full amount for their profit.

Doesn't have to, Had one myself that was never defaulted and by the time it was paid off all trace of anything negative was gone

elliechoc

It looks like Cabot took it on from 2011. I will see what they say in terms of back dating a default, I didn't realise that was possible.

But it definitely doesn't have a default at the moment, have checked Noddle, Clearscore and Equifax.

Keezing

A default definitely should have been applied when the repayment relationship broke down between you and the original creditor.

Time to make a complaint. If they don't back-date the default you can complain to the ICO or FOS.

Once this default has been correctly applied you should find that the account is removed from your credit file, or is due to be removed very soon.

This should be your focus in my opinion. Once the account has dropped off your credit file, you may find that the DCA give you a better settlement deal.

elliechoc

Is there a template letter for getting a default backdated? And would I send it to Cabot or Barclays as they were the original creditors.