Advice wanted on what to pay off first

agfoster1984

Hello, this will be a bit long but I will try and be as succinct as possible.

I currently have 2 debts showing on my credit file, I did have more, and whilst they have not been fully paid off, they have since dropped off as they were older than 6 years old. Of the current debts showing on my credit file, 1 is due to drop off in July 2023 and the other in Sept 2023.

I am not currently paying towards these 2 debts; as with all my debts they were on a Stepchange plan that expired but since that stopped neither has chased me for payment. The debts are £2,762 for a Nationwide credit card & £1,298 for a Nationwide overdraft on an old joint account with my ex partner, respectively.

I have however suddenly started receiving letters for a debt that is no longer on my credit file, that I did still owe money for. But the debtor and the amount are now different, but all other details are correct. This is for £2,834 for an old Barclaycard credit card and is being chased by Lowell; but according to an old spreadsheet I have, under the old Stepchange plan this was being paid to Hoist and was for £3,740, and was being paid at £1pm so would have reduced by that amount.

All other debts I owe have dropped off my credit file, due to defaulting over 6 years ago, and no-one has chased me for them for a long time. When the Stepchange plan stopped, a couple reached out and set up plans with me directly but some didn't contact me at all. The ones that did contact me, set me up on monthly direct debits, but despite me not cancelling them, these just ceased going out over a year ago, so I have been ignoring those and just kind of hoping that they go away. They won't be statute barred, as I have made payments towards them within the last 6 years, but they were all for far lower amounts (<£500). I believe Lowell might have started chasing me for the debt they manage, as I managed to get a mortgage and purchase a house in February, so thought that might have pinged something on a system somewhere.

Now my credit rating has been steadily going up, even prior to getting the mortgage and is monitored regularly via CreditKarma, and my rating is now only 30 points from their "fair" rating as it stands currently. I did also use CheckMyFile (I had a rating of 489/1000 on there) while I was applying for a mortgage, and the details did match CreditKarma, across the other credit reference agencies.

So in the hopes of improving my credit rating more over time:

1) Should I aim to pay off the debts that still show on my file, but aren't being actively chased? Or the debt that isn't on the file but is being chased? Which will have the better impact?

2) What should I now be doing about the other debts that I hadn't finished paying off and have dropped off my credit file? Other than the Lowell debt, none of the other debtors have contacted me since April 2022. I know I still owe that money and need to pay it and I do wish to pay it, but whilst it isn't being chased is it better to use that money to pay down other things?

Thanks in advance for your advice.

sourcrates

You are the debtor, your lenders are your creditors, and Lowell are a debt purchasing company who only collect there own debts, so it looks like Hoist have sold it to them.

Actions taken on any old debts that no longer show, will have zero impact on your credit file, as its self explanatory, they no longer show, so whatever happens, it no longer gets reported.

That is unless any legal action is taken, you would then have a CCJ in the public information section of your file, (if you did not discharge the debt within 30 days of judgement).

As you say, if your not being chased, then don`t rock the boat, however you ignore Lowell at your peril, I would be sending them the "provit letter", to see if what they have is enforceable, or not.

fatbelly

For the debts that no-one is pursuing, leave them alone.

For the Lowell debt, do a cca on it and if they can produce it, offer full and final settlement around 30%

agfoster1984

sourcrates said:

You are the debtor, your lenders are your creditors, and Lowell are a debt purchasing company who only collect there own debts, so it looks like Hoist have sold it to them.

Actions taken on any old debts that no longer show, will have zero impact on your credit file, as its self explanatory, they no longer show, so whatever happens, it no longer gets reported.

That is unless any legal action is taken, you would then have a CCJ in the public information section of your file, (if you did not discharge the debt within 30 days of judgement).

As you say, if your not being chased, then don`t rock the boat, however you ignore Lowell at your peril, I would be sending them the "provit letter", to see if what they have is enforceable, or not.

Thank you for reply, having read a few other posts, it feels like you reply to everyone.

Apologies for getting the terminology wrong with regards to who is debtor, creditor, etc.

I would avoid a CCJ at all costs, but just so I understand how this system works; when things go to court and ended with a CCJ, that would still show on a credit file even though the debt has been dropped from the file, due to being over 6 years old? I thought I had read in another thread on here that anything that happens after the 6 years from the initial default, doesn't show as nothing can put the debt back on a credit file. Or is it a case of the debt wouldn't show, but a CCJ would show? Also, does that CCJ show for 6 years from the judgement, or is that 6 years from the default too?

I'm assuming that also means that be engaging with Lowell, they won't be able to re-add the debt back onto my file?

Would the general advice be to ignore the debts no-one is chasing them, even if they still show on my file?

With regards to the Lowell letter, I have seen the "provit letter" thread, but wasn't sure if this still applied in this situation, as I know the debt is genuine. So surely even if they don't currently have the original agreement, they will be able to get a copy of it. Though I'm pretty sure this card was just offered to me by my bank when I turned 18, I know I didn't apply for it; can't remember if I signed something for it though. Not sure how tightly banks followed the regulations back in 2002.

As a side note, for debts that drop off my file but were never settled/paid off, what is the usual advice about reapplying with those creditors. E.G. should I avoid Nationwide, Barclaycard, et al like the plague going forward?

agfoster1984

fatbelly said:

For the debts that no-one is pursuing, leave them alone.

Even if they still show on my file?

Is this just in the hope that they will never chase them in the future?

For the Lowell debt, do a cca on it and if they can produce it, offer full and final settlement around 30%

Since both you and sourcrates have suggested it, I will be sending them a "provit letter" and see what they have. Though I suspect since the debt is genuine, they will likely have something official.

Prior to this suggestion, I had just been thinking about offering a F&F, since I had read about them on other threads and since the debt had already dropped off my file it seemed like the best course of action. But I will do a provit first, and cross all my fingers that they don't have anything to show for it. What happens if they don't? Will they just sell the debt to the next person and I have to keep repeating the process?

Out of curiosity, why did you suggest a F&F of 30%? I only ask since my partner has just agreed a F&F with one of her creditors but when she was discussing it with them they only offered a reduction of 25%; £2,230.91 from an original £2,974.55. Here debt would not drop off her file until January 2027, if that in any way impacts it. She had initially offered them £800 (approx 26% of the debt), which whilst less than your suggestion of 30%, is closer to your suggestion than what they came back with. Is there anything she (or I, if it comes to it with my debt) can do to get the respective creditors to accept closer to your suggested 30%?

sourcrates

If a debt has dropped off your file, nothing can make it re-emerge.

However, if you were taken to court for that debt, and lost, the judgement would show on your file, for 6 years, from the date of the judgement, unless it was paid in full within 30 days of the judgement date, then it would be removed.

Lenders are supposed to keep information for at least 6 years, in practice that can sometimes not be the case, a debt without provable paperwork cannot be enforced through the courts.
If that were the case, a letter telling them your not going to pay because the debt is unenforceable will, with most debt collectors, make them concentrate there efforts on those who will pay, eventually the debt will go statute barred, and you likely won`t here about it again.

Settling debts is more of an artform than anything, it can take a long while sometimes to get the deal you want, but it can be done, with tenacity, perseverance, a few white lies, and a big dollop of luck.
You always start low, to give yourself wiggle room if needed, the more good arguments you can provide as to why a creditor should accept your offer, the better.

fatbelly

agfoster1984 said:

 So surely even if they don't currently have the original agreement, they will be able to get a copy of it. Though I'm pretty sure this card was just offered to me by my bank when I turned 18, I know I didn't apply for it; can't remember if I signed something for it though. Not sure how tightly banks followed the regulations back in 2002.

As a side note, for debts that drop off my file but were never settled/paid off, what is the usual advice about reapplying with those creditors. E.G. should I avoid Nationwide, Barclaycard, et al like the plague going forward?

You don't know if they will be able to produce an original agreement until you make a request - a formal one is going to work best. For a 20-year old debt not taken out with the current creditor that could be a good tactic

If they can't then the debt is unenforceable.

You may or may not get a copy as a result of a prove-it but I suggested going straight to a cca as I think a prove-it is just kicking things down the road in your case.

I would avoid companies that you have debts with. When when they drop off your credit file, the organisation still holds internal records. 

If you look at the prove-it thread you will see that a prove-it and a cca request are not the same thing.

I suggested starting low if you get into F&F so as to give yourself room for negotiation. Starting at 26 % as you mentioned is a good idea. The creditor comes back with something like 75% and then you negotiate, by phone if you feel confident. But you always need the final deal in writing before you part with cash.

agfoster1984

sourcrates said:

If a debt has dropped off your file, nothing can make it re-emerge.

However, if you were taken to court for that debt, and lost, the judgement would show on your file, for 6 years, from the date of the judgement, unless it was paid in full within 30 days of the judgement date, then it would be removed.

Lenders are supposed to keep information for at least 6 years, in practice that can sometimes not be the case, a debt without provable paperwork cannot be enforced through the courts.
If that were the case, a letter telling them your not going to pay because the debt is unenforceable will, with most debt collectors, make them concentrate there efforts on those who will pay, eventually the debt will go statute barred, and you likely won`t here about it again.

Settling debts is more of an artform than anything, it can take a long while sometimes to get the deal you want, but it can be done, with tenacity, perseverance, a few white lies, and a big dollop of luck.
You always start low, to give yourself wiggle room if needed, the more good arguments you can provide as to why a creditor should accept your offer, the better.

All fantastic information, thank you so much.

I will ignore the debts that have fallen off my file, and the 2 currently showing, until such time as the creditors chase me for them. Hopefully that never comes to pass, fingers crossed.

I will send Lowell a "provit letter" and again hope they don't have the original agreement; if they don't I will celebrate, if they do I will make them a F&F offer. You mention that "most debt collectors will concentrate efforts elsewhere", what happens with the rare cases they don't? Can they keep hounding me to pay a debt they can't prove is enforceable? Or were you referring to the fact they could put effort into trying to find the original paperwork within the 6 years before it becomes statute barred?

Do you have any examples of good arguments that most creditors tend to recognize as valid reasons to accept lower offers?

I do have an autistic son, who is young (4) and tends to have care items and treatment session that become essential last minute purchases. But it feels dishonorable to try and use him as an excuse to pay less on my debts!

agfoster1984

I have been re-reading the "provit letter" thread again, can I just double check that is definitely the template I should be sending?

I only ask, because it states "Letter when you know nothing about the debt"...but I do know about this debt, I know I owe this debt. So do I want to send a "provit letter" or the later mentioned CCA request?

A CCA request seems more appropriate in my case, since I do know about the debt but just want to know if they can enforce it, except I also note in that thread that it says CCA requests tend to exact an adversarial response from the creditor. Which isn't something I want to do if I might then need to enter F&F negotiations with them.

The distinction between the 2 types of requests and their uses has confused me a bit, sorry.

agfoster1984

fatbelly said:

You don't know if they will be able to produce an original agreement until you make a request - a formal one is going to work best. For a 20-year old debt not taken out with the current creditor that could be a good tactic

If they can't then the debt is unenforceable.

You may or may not get a copy as a result of a prove-it but I suggested going straight to a cca as I think a prove-it is just kicking things down the road in your case.

After multiple read throughs of the "provit letter" thread, a CCA request does seem more appropriate for me. As I am not dispute the debt belongs to me, I know it does, i just want to know if it is enforcable.

My main worry with submitting a CCA request is that I read on that thread CCA requests tend to exact an adversarial response from the creditor. Which isn't something I want to cause if I might then need to enter F&F negotiations with them.

fatbelly said:

I would avoid companies that you have debts with. When when they drop off your credit file, the organisation still holds internal records. 

What if I wanted to be able to use those organizations again, would clearing the old debt (even if its dropped off my file) with them help? Or is the earth salted with them forever?

I'm only enquiring, as some of them are recommended on this site as banks to use for account benefits and/or mortgage rates. So it would be good if I could open those up to myself again in the future.

fatbelly said:

If you look at the prove-it thread you will see that a prove-it and a cca request are not the same thing.

I saw this. Is there a template for a CCA request anywhere? There appear to be extracts on the "provit letter" thread, but no actual template for CCA requests.

fatbelly said:

I suggested starting low if you get into F&F so as to give yourself room for negotiation. Starting at 26 % as you mentioned is a good idea. The creditor comes back with something like 75% and then you negotiate, by phone if you feel confident. But you always need the final deal in writing before you part with cash.

OK noted, though I am pretty bad at haggling. Best I could probably do is just be stubborn and keep offering the same amount over and over and hope they take it.

Something a friend has suggested is the argument "Well you can accept a full and final of £xxx or I'll have to set up a payment plan with you for £1 a month, which means you'll get less than £xxx before I die", I doubt I would word it exactly like that, but I liked the sentiment of his suggestion.

Rob5342

There is a CCA request template letter here, don't forget to include the £1 fee:

https://www.nationaldebtline.org/sample-letters/information-about-your-agreement-under-consumer-credit-act/

There is a good chance they won't be able to produce the CCA for a 20 year old debt, but you can only know for sure if you ask for it. PRA were unable to produce the CCA for an Egg/Barclaycard credit card I took out in 2001. They can still ask you to pay it if they can't produce it but they can't take any legal action against you. PRA phone me every two days about it, and write/email every two weeks. It's all phrased along the lines of how they can help me and discounts they can offer, but hidden away in the "contact us" section they says it's unenforceable and that they can't take any action.