DMP mutual support thread part 13 !!

sourcrates

funny_bunny said:

Moveslikeagger said:

Just to say I have had a DMP for 2 years now and have never provided any bank statements. Only my income and expenditure 

Thank you, much appreciate the advice.

When a debt sold to another DCA that you were already paying, do you have to renegotiate the repayment terms? 

Debts are bought and sold all the time, the new company will have no idea of the payment arrangement you had with the previous owner, or even if you were paying at all.

All they "buy" is a name, address, an account number, and the outstanding balance, just comes on a spreadsheet, alongside thousands of other accounts, then some office bod will attempt to call or text you, you should also receive a letter to inform you of the sale.

Best practice is then to write to them, tell them what you were paying previously, and tell them that`s what they will get also, they usually have varied payment options to choose from, that`s it basically.

sourcrates

19ryanh93 said:

Suseka97 said:

19ryanh93 said:

Suseka97 said:

19ryanh93 said:

Suseka97 said:

Thanks for the reply

Should I send them a letter saying I will not be making payments towards the debts before i just stop?

No reason why not to - you can say something along the lines of that you will be focussing on paying your enforceable debts.  Keep it short and stop the payments.

Ok I’ll write a letter tomorrow. It’s been 3 months now and nothing. I’m only paying token payments at the moment. 

Knowing my luck they’ll send the CCAs to me within weeks of me sending a letter. 

Moving forward into the future and to F&Fs can that still be done even if I’m not paying due to not making a payment?

Yes,  but it does depend on how long since the UE was reported and the DCA involved.  So the first thing to do is to stop making token payments, these are pointless and stop the debt moving into 'statue barred territory'.  So to explain, some DCA's are pretty stubborn when it comes to F&Fs and others are more amenable.  I've had 2 x UE's with PRA and they are offering 60% discount on one and only 20% discount on the other.  These debts have been UE for close to 3 years now.  I've stopped engaging with them for a good 2 years now and all I get are statements from time to time.  It's a waiting game and one you need to be prepared for.

Thanks for the advice. Appreciate it. 

When they’ve sent you offers have you asked for them or have they just randomly sent them? 

Just curious for the future. 

Debt purchasing is a business, as stated previously, debts are bought and sold for a fraction of their face value.

The DPC then wants the full balance back off you, at least initially, there are various scenario's that play out here, it depends on many things, how long you take to make contact, or if the payment plan you are on will take a silly length of time to complete.

These companies have a range of template letters they use, from the initial first "contact us to arrange payment" to "reminders your debt remains outstanding" then "threats of court action" to "50% off if you pay today".

They get sent at various times, dependant on circumstances, most companies don`t want accounts hanging around for ever, so end of the tax year is a good time to obtain settlement offers, they usually write to you, they like to keep things moving you see.

Not all debt purchasing companies do this, but most do, which is why we advise keeping an emergency fund topped up so that one use for it can be settlement offers, at sometime in the future.

funny_bunny

@sourcrates if a DCA contacts with settlement offer with discount, is there any way to ensure they won't just take the money and sell the rest to another DCA and all goes back to square one? I remember few years ago something like that (can't remember exact details) happened to someone I know unless that practice has changed/regulated now.

Also, I remember you said in another post "only way to stop interest permanently is to default on the debts, the reasoning behind this is that any interest charged before default, is offset by part settlement offers further down the line." Does that mean interest already paid is offset against the total original credit awarded by the lender hence they are able to offer discount at the end? Would you mind elaborate a bit please?

Thank you.

Suseka97

jwil said:

For everyone who wants to check their credit report - don't pay monthly for it.  You can get it for free through MSE Credit Club on here (Experian) and also from Credit Karma (Transunion).  I don't use any more so don't know if there's also a free equivalent for Equifax.  

Clearscore is the free equivalent for Equifax.

sourcrates

funny_bunny said:

@sourcrates if a DCA contacts with settlement offer with discount, is there any way to ensure they won't just take the money and sell the rest to another DCA and all goes back to square one? I remember few years ago something like that (can't remember exact details) happened to someone I know unless that practice has changed/regulated now.

Also, I remember you said in another post "only way to stop interest permanently is to default on the debts, the reasoning behind this is that any interest charged before default, is offset by part settlement offers further down the line." Does that mean interest already paid is offset against the total original credit awarded by the lender hence they are able to offer discount at the end? Would you mind elaborate a bit please?

Thank you.

When you make an offer to settle a debt, you do so in writing, and you must use the correct legal wording, there are various ways to word it, this is from the National Debtline settlement letter -

"I am making this offer on the clear understanding that, if you accept it, neither you nor any associate company will take any other action to collect or enforce this debt in any way and that I will be released from any liability".

You must have this in writing, signed, sealed and delivered, otherwise you are quite correct, the remaining balance can be sold on, and you can be chased all over again by someone else, that`s why I cringe when people say they have settled the debt over the phone, and are now debt free, then months later, because they didn`t get the deal signed off in writing, another DCA attempts to collect the remainder, and they cannot understand why, its very important to do things correctly.

Interest already paid is not directly off set against the balance, no.

What I meant was that any interest you have added to a debt after you stop paying, but before it defaults, which then obviously increases the balance, then that could be off set if you manage to settle the debt further down the line, for a discounted price, I don`t mean exact figures here, just as a general rule, you get a good settlement deal, so the interest that was added didn`t make a whole lot of difference to your overall situation, I hope I've explained that more clearly.

Suseka97

funny_bunny said:

@sourcrates if a DCA contacts with settlement offer with discount, is there any way to ensure they won't just take the money and sell the rest to another DCA and all goes back to square one? I remember few years ago something like that (can't remember exact details) happened to someone I know unless that practice has changed/regulated now.

Also, I remember you said in another post "only way to stop interest permanently is to default on the debts, the reasoning behind this is that any interest charged before default, is offset by part settlement offers further down the line." Does that mean interest already paid is offset against the total original credit awarded by the lender hence they are able to offer discount at the end? Would you mind elaborate a bit please?

Thank you.

With full and final offers you need to start the letter with a header that states 'Without Prejudice' (in bold lettering so it stands out).  The in the body of the text you need to include this "......I am making this offer on the clear understanding that, if you accept it, neither you nor any associate company will take any other action to collect or enforce this debt in any way and I will be released from any further liability...."

Suseka97

19ryanh93 said:

Thanks for the advice. Appreciate it. 

When they’ve sent you offers have you asked for them or have they just randomly sent them? 

Just curious for the future. 

When the debts came back at UE I left it a few months then I sent F&Fs for them.  Although they knew they were UE they rejected my offers which were around the 50% mark.   I haven't made any offers since then, around 3 years ago, and it was about 2 years ago they started sending me offers.  They do this every 3 months or so and whilst the discount on one has reached around the 60% mark, the other has stuck at only 20%.  

There is simply no consistency with regards to what they'll accept/agree to or when - it's a case of waiting it out or walking away.

funny_bunny

sourcrates said:

funny_bunny said:

@sourcrates if a DCA contacts with settlement offer with discount, is there any way to ensure they won't just take the money and sell the rest to another DCA and all goes back to square one? I remember few years ago something like that (can't remember exact details) happened to someone I know unless that practice has changed/regulated now.

Also, I remember you said in another post "only way to stop interest permanently is to default on the debts, the reasoning behind this is that any interest charged before default, is offset by part settlement offers further down the line." Does that mean interest already paid is offset against the total original credit awarded by the lender hence they are able to offer discount at the end? Would you mind elaborate a bit please?

Thank you.

When you make an offer to settle a debt, you do so in writing, and you must use the correct legal wording, there are various ways to word it, this is from the National Debtline settlement letter -

"I am making this offer on the clear understanding that, if you accept it, neither you nor any associate company will take any other action to collect or enforce this debt in any way and that I will be released from any liability".

You must have this in writing, signed, sealed and delivered, otherwise you are quite correct, the remaining balance can be sold on, and you can be chased all over again by someone else, that`s why I cringe when people say they have settled the debt over the phone, and are now debt free, then months later, because they didn`t get the deal signed off in writing, another DCA attempts to collect the remainder, and they cannot understand why, its very important to do things correctly.

Interest already paid is not directly off set against the balance, no.

What I meant was that any interest you have added to a debt after you stop paying, but before it defaults, which then obviously increases the balance, then that could be off set if you manage to settle the debt further down the line, for a discounted price, I don`t mean exact figures here, just as a general rule, you get a good settlement deal, so the interest that was added didn`t make a whole lot of difference to your overall situation, I hope I've explained that more clearly.

Thank you, that clarifies both.

I wasn't aware of national debtline's sample letters, very useful.

funny_bunny

Suseka97 said:

funny_bunny said:

@sourcrates if a DCA contacts with settlement offer with discount, is there any way to ensure they won't just take the money and sell the rest to another DCA and all goes back to square one? I remember few years ago something like that (can't remember exact details) happened to someone I know unless that practice has changed/regulated now.

Also, I remember you said in another post "only way to stop interest permanently is to default on the debts, the reasoning behind this is that any interest charged before default, is offset by part settlement offers further down the line." Does that mean interest already paid is offset against the total original credit awarded by the lender hence they are able to offer discount at the end? Would you mind elaborate a bit please?

Thank you.

With full and final offers you need to start the letter with a header that states 'Without Prejudice' (in bold lettering so it stands out).  The in the body of the text you need to include this "......I am making this offer on the clear understanding that, if you accept it, neither you nor any associate company will take any other action to collect or enforce this debt in any way and I will be released from any further liability...."

Thank you for pointing this out. 

All these generous share of knowledge giving me the right confidence I need.

sourcrates

funny_bunny said:

Suseka97 said:

funny_bunny said:

@sourcrates if a DCA contacts with settlement offer with discount, is there any way to ensure they won't just take the money and sell the rest to another DCA and all goes back to square one? I remember few years ago something like that (can't remember exact details) happened to someone I know unless that practice has changed/regulated now.

Also, I remember you said in another post "only way to stop interest permanently is to default on the debts, the reasoning behind this is that any interest charged before default, is offset by part settlement offers further down the line." Does that mean interest already paid is offset against the total original credit awarded by the lender hence they are able to offer discount at the end? Would you mind elaborate a bit please?

Thank you.

With full and final offers you need to start the letter with a header that states 'Without Prejudice' (in bold lettering so it stands out).  The in the body of the text you need to include this "......I am making this offer on the clear understanding that, if you accept it, neither you nor any associate company will take any other action to collect or enforce this debt in any way and I will be released from any further liability...."

Thank you for pointing this out. 

All these generous share of knowledge giving me the right confidence I need.

The reason you use the term "without prejudice" is so the creditor cannot use the contents of the letter against you in any future potential court case.