Please don't be offened

butterflylady

Hi,
This thread is not meant to offend anyone but I was wondering if anyone could give me some advice.

Here goes:

I have been lurking on this site for a while and have been impressed with the amount people are paying off, however when I read further it seems the majority of this is full and final settlements.

It seems that the only people who get these are the ones who have missed payments and are now on some sort of payment plan.

I am just returning to work after having my first child, on my part time wages I will be able to afford my loan, living expenses, childcare. However I will have no money clothes, haircuts etc.

So my question is what do I do, do I stop making payments save the money and then when it gets past to a debt collection agency make a full and final settlement offer, wrecking my credit rating but saving myself money or keep struggling on paying everything in full but have no money for the next 2 and a half years!!!

Triker

Sorry hun, unable to advise but I'd be interested to find out what the answer is. Thanks for asking anyway.:D

Jacks_xxx

butterflylady wrote: »

Hi,
This thread is not meant to offend anyone but I was wondering if anyone could give me some advice.

Here goes:

I have been lurking on this site for a while and have been impressed with the amount people are paying off, however when I read further it seems the majority of this is full and final settlements.

It seems that the only people who get these are the ones who have missed payments and are now on some sort of payment plan.

I am just returning to work after having my first child, on my part time wages I will be able to afford my loan, living expenses, childcare. However I will have no money clothes, haircuts etc.

So my question is what do I do, do I stop making payments save the money and then when it gets past to a debt collection agency make a full and final settlement offer, wrecking my credit rating but saving myself money or keep struggling on paying everything in full but have no money for the next 2 and a half years!!!

Hey sweetie, :wave:

We had £96700 of debt to pay off as of Aug 2006 and the short version of how we're doing it is:

• We asked all of our creditors to freeze the interest for a while. (Most of them did.)
• We cut back our expenditure - hard!
• We are paying it all off according to the snowball rules of highest interest first.

Perhaps a first step for you would be to post a SOA and everybody on the board can suggest better deals or different ways of doing things to cut down your outgoings and well as ideas for increasing your income?

I did it a few months ago. It's very useful to get fresh eyes on your spending as it makes you think about whether all that stuff we just mindlessly pay for every month is really all that necessary?

HTH honey,

Love Jacks xxx

mrsspendalot

I think you would be unwise to stop payments in the hope they would default you so you can try and make full and final settlements somewhere along the line. There is no guarantee that a company would accept a full and final settlement, so you could be wrecking your credit file for nothing. I would post up your statement of affairs and see if we can help you get in control.

hypno06

We are opting for the "struggle on and pay the full amount" option, but that is largely because I want to move house (in an ideal world) in a few years time, and may not be able to get the mortgage we need if our credit rating is poor. Also, my previous profession required me to be credit checked frequently, and I may want to return to that in due course, so cannot afford to have it trashed.

It is a very individual decision. Sometimes I am "jealous" of those able to get a reduced figure to pay off, or to have interest frozen, but then I remind myself that I am not jealous of the defaults and the dealing with DCAs etc that they have to do, and that I am doing it "my way" for "my reason"

BTW, I hope this doesn't come across as saying one is better than the other - it is not. You have to do what is right for you.

mrsspendalot

hypno06 wrote: »

It is a very individual decision. Sometimes I am "jealous" of those able to get a reduced figure to pay off, or to have interest frozen, but then I remind myself that I am not jealous of the defaults and the dealing with DCAs etc that they have to do, and that I am doing it "my way" for "my reason"

BTW, I hope this doesn't come across as saying one is better than the other - it is not. You have to do what is right for you.

I agree Hypno

I wish I could wind the clock back 6 years before I defaulted and sort my mess out properly. I might have been able to avoid the mess I have had to get out of since my credit rating was wrecked.

If you can pay off in full, then do it without wrecking your credit file. Having defaults is not the easy option, believe me!

whitewing

I think it's a good question too. Jacks xxx is right - post up an SOA and the advice you are given there will hopefully answer your question and let you know what is feasible.

My guess is that you will be able to pay it off quicker than you think, and certainly quicker and with much less stress than defaulting and having to deal with the hassle arising from not paying.

Buffythedebtslayer

I really see your point, in real life I know some of my friends run up bills and get themselves in to such a mess and don't worry about it nearly as much, but I really wouldn't risk my credit rating, especially not at the moment, I think of the fear and the waiting and wondering some people go through to sort out their full and final settlement it is such a risk.

the whole money thing is very frightening.

southernscouser

It all depends.

Firstly, no creditor is obliged to accept a full and final settlement. They will only do it when they believe the chances of them receiving the full amount are small or it's cost effective for them to write a proportion of the debt off.

For them to consider this it probably takes years of missed payments, paying late, then on to DMP's etc. I'd be surprised if say they accepted after 6 months or something.

What you have to weigh up is do you want potentially years of hassle, phone calls, letters, people knocking on your door, the trashed credit record for 6 years, it being sold on to DMC's etc for the sake of maybe getting 30% of the debt written off.

The people who are able to do so have been through alot of crap, worry, depression.

Although it sounds great on paper, it isn't an easy way out.

chardonnay_2

i know of someone with a debt of 7k with a creditor who has been offerred a partial settlement of under 3k. obviuosly this is a huge disc but will stay on their credit file as a partial settlement. this is only after min of 6 months of hassle by mail and threats of doorstep visits. it really depends on how much you value your future credit rating and whether you can handle the mental strain?

barron_hard_up

Pay the bills you have to pay, don't get behind if you don't have to. Cut back on things you can do without and you will be surprised where some spare cash can come from. I have bought some great clothes in charity shops, especially in up market towns such as Harrogate, where wealthy people cast off near perfect expensive clothes. You do not want the grief that go's with defaulting on loans etc.