Outstanding Debt and Critical illness claim

ploppy

Not sure if this is the right forum, hopefully someone can post me in the right direction if not. I’ll try keep this brief🤪 I have been on a DMP for many years with 5 still to go, approx £12k still to be repayed over this time, my own fault trying to keep a failing business afloat and not wanting to declare bankruptcy (which would have been easier). Anyway, I was recently diagnosed with Stage 3 bowel cancer, tumour removed in January and now going through chemo. This has allowed me to make a claim on my critical illness policy (joint) for £30k which has just been approved. All debt is in my name but payout will be joint. Would I be able to make offers on my debt or would that be unethical as I would have the money to pay in full. I have been able to continue working as during this pandemic as I have had no choice but to work from home which has been a godsend as I can work extra when feeling good and work minimal when not, something I couldn’t have done with no pandemic. However I would like to keep as much as I can as I do not know what the future holds. Any thoughts/advice greatly appreciated.

[Deleted User]

ploppy said:

Not sure if this is the right forum, hopefully someone can post me in the right direction if not. I’ll try keep this brief🤪 I have been on a DMP for many years with 5 still to go, approx £12k still to be repayed over this time, my own fault trying to keep a failing business afloat and not wanting to declare bankruptcy (which would have been easier). Anyway, I was recently diagnosed with Stage 3 bowel cancer, tumour removed in January and now going through chemo. This has allowed me to make a claim on my critical illness policy (joint) for £30k which has just been approved. All debt is in my name but payout will be joint. Would I be able to make offers on my debt or would that be unethical as I would have the money to pay in full. I have been able to continue working as during this pandemic as I have had no choice but to work from home which has been a godsend as I can work extra when feeling good and work minimal when not, something I couldn’t have done with no pandemic. However I would like to keep as much as I can as I do not know what the future holds. Any thoughts/advice greatly appreciated.

I don't think it's unethical.  You've been in a DMP for 5 years so I'm guessing your debts are all defaulted and some may even have been sold on to debt collection agencies for pennies in the pound.  Debt Camel has a guide to making full and final settlements and your creditors don't need to know that you have £30k from your policy.

https://debtcamel.co.uk/debt-options/less-common/full-final/

Bon chance!

EimearF

Its not unethical to make offers but in your case i would keep the money. As you have said you are only able to work because its from home if work goes back you may have a dip in income until you are better. Keep the money for now and focus on getting better. When you come out the other side make the full and final offers. 

sourcrates

I hate it when people use the words "ethiical" or "moral" when refering to debt matters, the two are poles apart.

Unsecured debts are all deemed to be "non priority debts", that means they are not essential, unlike council tax or rent for example.

So they come last on the list for payment, assuming all your debts have defaulted and been sold on, then debt purchasing companies are always open to a settlement offer, if the debt remains with the original creditors, then some discount will be achieveble also.

Never disclose the origin of the money you intend to settle with, or the amount you have available, its no one elses buisness, do everything in writing only, yes you can negoatiate over the phone, as long as the agreement you reach is backed up in writing.

A good place to start is at 30% of outstanding balance, remember, this is a matter of negoatiation, think of it as more of a marathon, than a sprint.

Any agreement must include this line ::

"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"

National debtline provide a useful template letter just for this purpose, it can be found here ::

https://www.nationaldebtline.org/EW/sampleletters/Pages/Full-and-final-settlement-offers-(sole-name).aspx

ploppy

Thanks so so much for the replies and advice. Think I have it in my head I need to disclose any savings as part of my DMP. As this would be money in my account am I not obliged to disclose? Been on a DMP for must be 8 years now, can’t really remember what was agreed and didn’t want to inform them in case they were obliged to notify creditors (my DMP annual review is due end of month). Hence my thinking it may be better to make offers before review. Am I way off the mark?

sammyjammy

Who is your DMP with?

ploppy

Payplan m8