Getting CC companies to write off some of your debt for an up-front payment?

fillerbunny

A friend forwarded me a quote from a book called "The Rules of Wealth" by Richard Templar:

"I have a friend who wrote to all his creditors and offered them an immediate payment of 50% if they would write the debt off - this included all his credit card people. Surprisingly every single one of them said yes and he took out a bank loan and paid them all off without having to declare himself bankrupt. He thus consolidated his debts and reduced them by half. Brilliant."

I am just about to consolidate about £7000 worth of credit card debt (spread over four cards, most of which are at about 20% APR) into a loan, but it seems like it might be worth giving this a go and seeing if I can get the credit card companies to write off some of the debt.

I am nowhere near declaring myself bankrupt, and I presume this would be the main motivating factor for CC companies to accept the idea - so I wondered if anyone had any advice for wording the letters! Is there another way I can convince them it would be a good idea?

nomoneytoday

Chapter 2 is called, "How to mess up your credit rating for the next years"...

fillerbunny

Care to say more?

My credit rating is already shot to hell and I am consolidating with the help of a loan from a very generous and understanding parent - if I can reduce the amount I have to pay with a mere letter I don't see why I shouldn't try.

However, if the whole idea is a myth or has drawbacks, a little more explanation would be appreciated.

CLAPTON

it is possible to offer Full and Final settlements successfully i.e. offer less than you actually owe.

Usually it will work (although no guarentees ) in the following circumstances

-you stop paying your debts
- after a while your creditors default your accounts and trash your credit records for 6 years.
- you come to an arrangment to make reduced payments after sending them income and expenditure statments and/or using companies like Payplan / CCCS/ CAB.
- they sell youir debt to DCA.
-after 2/3 years its usually possible to do a F&F.
-they may of course go the CCJ route or Charging order on your property (if you have one) .

Dylanwing

A few years ago, maybe. As far as i am aware, they will only accept partial payment after default, and even then, nothing is guaranteed. At the time of my bad problems, 75% was the norm, but I gather that figure has increased and some Companies won't even negotiate.