Final Settlement Advice needed - stepchange ordo it myself

Fluff_Brain

Hi
I am currently on a DMP with stepchange (since June last year) I owe around £16500. (think I have paid off around £6800) I do pay as much as I can afford each month (around £460) as I want to try and clear the debt as soon as I can.

I have now had a lumpsum pay out of £13500 which I would like to use to try and pay off my debts as much as possible,

I have read several posts on here regarding full and final settlements/partial settlements and understand it sticks on your credit file - I don;t have an issue with this as me and credit are not good friends...

My question is, do I allow stepchange to handle this, or am I better doing it myself? it would be nice to get the best deal that I can for my money - clearing the debt would be a dream ,,

Any advice welcomed as I really don't know what to do for the best ..

Thanks in advance

sourcrates

Hi,

It’s a very simple choice, if you let stepchange do it, you will have to pay all the money directly to them, and they will then negotiate with creditors on your behalf.

Alternatively if you do it yourself, you can keep up negoatiations as long as you wish in order to obtain the best deal, and you may have money left over.

Bear in mind that the stepchange doctrin is to repay as much of your debts as possible, that would make up my mind.

Personally i’d do it myself, as I would not trust a stranger to get me the best deal.

Fluff_Brain

Thanks for the quick reply.. I was thinking of going it alone... Do I offer a figure or do I contact them and get them to make the offer? How much information do I have to tell them ? sorry for the daft questions, all new to me, but I want to be clued up before I take the plunge...

sourcrates

Hi,

You make the offer using this letter :

https://www.nationaldebtline.org/EW/sampleletters/Pages/Full-and-final-settlement-offers-%28sole-name%29.aspx

You must make sure you have agreement to the terms stipulated in this letter, otherwise you face trouble in the future.

People normally start at around 30/40% of the outstanding balance, you can always increase your offer, are all your debts enforceable ?

Something else you need to check before you do anything else.

Send CCA requests to all your relevant creditors first, if they can’t provide compliant paperwork, they may settle for a lot less.

As with everything there is a correct process to follow to get the best deals available.

fatbelly

Definitely do it yourself.

Nothing much to add to the above except not to part with any money until you have the deal spelt out to your satisfaction in writing.

I like to start and conclude the process in writing. But if the middle stages need negotiation, I'm happy to do that by phone.

RMJ20

I think I'd definitely be looking at doing it myself. More control and you would know where your money was going. What a feeling that will be when it's paid off. Good for you!

January2015

You should, at least initially, offer the same percentage to all creditors, e.g. 20% of the debt. This shows creditors you are treating them fairly and equitably. When I send F&Fs, I send all creditors a table listing all my creditors and outstanding balances, and the final column shows what I am offering each creditor. That way they can all see they are being offered the same percentage as every other creditor.

Of course, once you start negotiating directly with individual creditors it's up to you if you choose to give one a slightly higher percentage than another.

Fluff_Brain

Oh My... thanks all for the info.. What is an enforceable debt? I have googled, but can't find a simple explanation....

MovingForwards

I make my f&f offers myself, I also have a look at how much is owing, how much is being paid to them per month and do a rough calculation on how many years it would take to clear if they dont accept the offer.

(Mine are quite old now)

I also check to sed if the debt is showing on my credit history or whether it has dropped off because of being over 6 years old.

Armed with all of that I then call them up and negotiate it taking the stance of a builder or car garage when you want a quote.

Make my low offer, they come back with theirs, I say too much and havent got it but can increase it to X, if they dont want to accept it then the instalments will carry on as before, they come back with a realistic one. I then get the talk about affecting credit history/marked as part settled (nope as it isnt on my history), confirm the offer is full and final, no more money after, account to be closed and letter sent to me confirming the account is settled/closed. They agree, I make payment and they send the letter.

I do it this way as I have many years experience of negotiating settlements in my previous career.

If you havd a small debt (couple of hundred) you could do it.

Larger ones I would agree with above people saying write to them.

Lastly, do not plan to use all your payout, set yourself a limit eg 10k and see if you can get them all paid off with that, it will leave you a float to get you back on your feet.

fatbelly

Fluff_Brain wrote: »

Oh My... thanks all for the info.. What is an enforceable debt? I have googled, but can't find a simple explanation....

It's easier to say what is unenforceable

That would be a debt for which, if the creditor took court action, you would have a full defence.

Normally both parties would understand if this was the case and the creditor would not waste their money on starting action.

Debts can be unenforceable for many reasons but the main ones we come across are:

• a request for information under s77-79 of the consumer credit act has not been complied with (lazily referred to as a CCA request)
  
• the debt is consumer credit act, pre-april 2007, and there is no original agreement (s127(3)), as was often the case for catalogues.
  
• there has been a period of more than 6 years when you did not acknowledge the debt by way of payment or in writing, Limitation Act 1980 s5

Fluff_Brain

fatbelly wrote: »

It's easier to say what is unenforceable

That would be a debt for which, if the creditor took court action, you would have a full defence.

Normally both parties would understand if this was the case and the creditor would not waste their money on starting action.

Debts can be unenforceable for many reasons but the main ones we come across are:

• a request for information under s77-79 of the consumer credit act has not been complied with (lazily referred to as a CCA request)
• the debt is consumer credit act, pre-april 2007, and there is no original agreement (s127(3)), as was often the case for catalogues.
• there has been a period of more than 6 years when you did not acknowledge the debt by way of payment or in writing, Limitation Act 1980 s5

Brilliant, Thankyou, all makes sense now !!