Full and Final Settlement offer

Peter_Pan

Have posted on DFW thread but had no reply so thought i'd post on here after all the help we got when OH when B/c last week.

Bit of background

OH has gone bankrupt leaving me with £6000 debt (£3k in my name (2 credit cards )and £3k joint overdraft), after talking to the CCCS and Payplan who said going bankrupt was a bit heavy handed, my parents have offered me a lump sum payment to the creditors of £3k. I have sent letters off a week ago to the credit cards making an offer of £1 a month with a review in 6 months or to accept a pro rata offer (sharing the £3k) , my questions are

1. in the meantime should i make the £1 payment even if i don't hear from them?

2. As the paperwork is only just filtering through to creditors re OH b/c should i send the same letter to the bank or wait for them to contact me about the debt in joint names? I'm assuming the account is or will be frozen by the OR very shortly and interest will be frozen as well.
My thinking is if i write now asking them to freeze interest and offering a token payment or a pro rata settlement that at least no more charges will be added.

What do you think?

Many thanks

tigerfeet2006

Hi PP,

My feeling would be to pay £1 TOKEN PAYMENT TO THEM (oops!!)

As for the other question gut feeling is to write to them giving husbands BR details and similar offer, £1 or pro rata.

Can I be cheeky and ask how you have worded the offer to them?

rog2

Hi PP - I have just 'lost' my first post, so if this appears twice, please forgive me.
Whilst there is little that you will be able to do in regard to overdrafts on a joint account, or joint loans, it is definitely worth checking out your obligations to Credit Card Companies before making any offers of payment - if you were only a second card holder you may not have any liability for any debt on that account and it will be dealt with through your OH's bankruptcy.
Personally, I would hold fire on making ANY F&F offers until all the paperwork has 'filtered through' or you may be paying for something that you don't need to.
Have a word with National Debtline - 0808 808 4000 - or visit them on http://www.nationaldebtline.co.uk/england_wales where you will find factsheets about full and final offers, with template letters that you can send to your creditors.
But SPEAK to them first - I wouldn't like to see you paying for something that you don't need to.

Peter_Pan

Thanks
Rog2 - The credit cards are ones held in my name only as main card holder.

Tigerfeet2006 I will put a copy of the letter up on here later (not on my own PC at moment), I think i will leave it a few days for the bank letter so that the B/C paperwork can filter through to them.

Debbie

rog2

Peter_Pan wrote: »

Rog2 - The credit cards are ones held in my name only as main card holder. Debbie

Then it's still worth having a look at the NDL site.
If you post a full SOA (statement of Affairs) listing your income, expenses and debts you will get lots of advice from this site as well.

Peter_Pan

Heres the letter i sent, i pinched some of the wording from another thread on this forum

WITHOUT PREJUDICE
Re Account no xxxxxxxxx
I write with reference to the above account.

I can confirm that I have been in contact with the CCCS in order to sort out my finances due to the change in my circumstances and they have advised me that in the event of a bankruptcy, all foreseeable income would be inalienable under the Social Security Administration Act 1992 (Child Benefit/tax credits) and that as I have no significant assets it would be in my interest to also start bankruptcy proceedings.

Nevertheless as a responsible debtor, I wish to find a way to amicably settling all outstanding debts. I would therefore ask you to accept a notional payment of £1 a month on the debt and to freeze any further charges on the account, with the expectation that this would be reviewed in six months.

Alternatively, I can offer you a pro-rata payment of £xxx via a third party as an ex-gratia payment in full and final settlement of the account. This offer is made on the clear understanding that, if accepted, neither you nor any associate Company will take any other action to enforce or pursue this debt in any way whatsoever and that I will be released from any liability and is a time sensitive offer.

I also request that, if accepted, you will mark any entry on a credit reference agency file relating to the above account as “satisfied” in full.

Payment can be made within the next 28 days of receiving your written agreement of this offer and method of payment.

At your request I am quite prepared to inform you of how I have apportioned the funds to yourself and the other two creditors involved.

I look forward to receiving your reply.

I had one of the creditors call today and are sending me a letter requesting a statement of outgoings and agreeing to the token payment for now, they were very helpful and although they said they could accept an offer of 80% at this stage they did say once they had further info from me they would then decide on my lower offer and that if any of the other creditors accepted in the meantime to let them know because it would make it more likely that they would then accept.
A step in the right direction hopefully.

fermi

That looks to be a very hopeful start.

With your OH being BR they can't really treat your letter as too much of a bluff, so I would keep pressing.

Peter_Pan

Second creditor has now been in touch by letter saying its better to call them so i did - had to start from scratch telling them our situation, then was told its was the wrong number. Phoned the number given and had a real jobsworth - apparently Company won't consider a reduced payment settlement until you have been on a reduced payment plan for 6 months.
I explained OH is bankrupt, i'm not working and my parents have offered soem money to settle rather then me going bankrupt as well - still won't budge so am having to send off an I&E to them with details and evidence of my income and they will see about putting me on a reduced payment plan.
Have still to contact bank with a letter offering a pro rata settlement, wanted to get OH s OR interview out of the way (its tomorrow:eek: ) will put the letter into bank tomorrow.

What happens if one of the creditors accept the settlement and the others don't?- do i still pay the one accepting it (with my parents agreement), they have really put up the money so that we can make a fresh start and for me not have to go bankrupt. Its not worth them paying one and then i have to go bankrupt anyway - i would feel they have thrown their money away.

rog2

Peter_Pan wrote: »

Second creditor has now been in touch by letter saying its better to call them so i did - had to start from scratch telling them our situation, then was told its was the wrong number. Phoned the number given and had a real jobsworth - apparently Company won't consider a reduced payment settlement until you have been on a reduced payment plan for 6 months.

PP - it is NEVER better to phone them - they are trained at twisting your words, and will try their level best to mislead you over your rights.
Nine times out of ten, they will ask you to ring an 0870 number, which costs you in excess of 11p a minute, with a high percentage of that cost going directly into the pockets of the 'creditor'.

Peter_Pan

Thanks rog2,
Now i know, hadn't thought of it in that way. They also said that with £1 a month offers they usually sell them to a debt collecting agency so why can't they just settle for the 50% i'm offering which is a lot more than they would get by selling it to an agency.
Will send off letter adding a sentence that i want all contact to be by letter only and see what happens next.

Peter_Pan

Just an update on my offers.

Both my main creditors have frozen interest and charges and have me on a 6 month payment plan, the bank have sent a letter saying the account has been passed to their recovery department but no reply to my letter re settlement so are still adding interest each month.

Its a slow drawn out process and i seem to have to keep repeating everything to them, probably because theres not just one person dealing with it but i feel we have progressed a small step and i'm going to enjoy Christmas with the children and OH (of course) and review the situation in the New Year.

Thanks everyone who has given us support, this site has helped enormously.