Partially Satisfied

smokey26

Hi

One of my creditors has written to me today telling me they will write off 80% of my balance if I pay the remainder in full by the end of may. 

The has not defaulted but has had late payments. If I accept this offer, what impact will it have on my credit file? I can only find information about partial settlement on defaulted accounts

can anyone advise please?

fatbelly

An unsolicited 20% settlement deal on an undefaulted debt is unheard of.

I can't believe this is a mainstream creditor

Who are they and how have they said they will mark your file?

smokey26

fatbelly said:

An unsolicited 20% settlement deal on an undefaulted debt is unheard of.

I can't believe this is a mainstream creditor

Who are they and how have they said they will mark your file?

Hi 

it’s with Intrum. Originally the loan was with Creation but they sold it to Intrum. The letter only says that if the account is in default they would mark it as partially settled but the account has not defaulted. I want to understand what the impact only credit file is before I accept the offer.

thanks 

fatbelly

It will have defaulted before they sold it. It will be marked partially settled. A settled default looks better than an unsettled one.

This is fishy. I'd do a cca request to them

smokey26

fatbelly said:

It will have defaulted before they sold it. It will be marked partially settled. A settled default looks better than an unsettled one.

This is fishy. I'd do a cca request to them

What is a cca request?

It hadn’t defaulted with Creation. They had given me breathing space and reduced my payments but I was unable to return to full payments after the agreed breathing space so they sold the debt on. I got a letter from Intrum telling me I needed to make a payment to stop the account from defaulting which I did. Just looked at my credit report and it is showing as ‘in arrears’.  I don’t have any defaults on my credit file. 

stu12345_2

a cca request is a consumer credit act letter you send to see if the paperwork is correct, if it is not, then the debt is unenforceable and you don't need to pay it 
normally when a debt is sold on the paperwork doesn't follow on too.( thus it's unenforceable as the new owner can't force you to pay up)

you send the short letter asking for a copy of your credit agreement for that debt and statements for the debt too
you also send  a cheque postal order for £1 admin fee to the current owner or creditor, the £1 is normally returned and never cashed.

can I ask how did you get breathing space, as that is a 2 month period where creditors can't take action against you and is only set up via debt charities like step change and you must be a client with them

smokey26

stu12345_2 said:

a cca request is a consumer credit act letter you send to see if the paperwork is correct, if it is not, then the debt is unenforceable and you don't need to pay it 
normally when a debt is sold on the paperwork doesn't follow on too.( thus it's unenforceable as the new owner can't force you to pay up)

you send the short letter asking for a copy of your credit agreement for that debt and statements for the debt too
you also send  a cheque postal order for £1 admin fee to the current owner or creditor, the £1 is normally returned and never cashed.

can I ask how did you get breathing space, as that is a 2 month period where creditors can't take action against you and is only set up via debt charities like step change and you must be a client with them

Thanks for the reply. I initially wrote to creation using some templates from national debt line asking for reduced payments. They allowed me to reduce my payments from the contractual amount for 9 months. When this ended they sold the debt to intrum. It was not in default when it was with creation. It was shown as ‘special arrangement’. Now the debt is with intrum it is showing on my report as ‘in arrears’. If the debt is not enforceable and I don’t pay, I assume they are able to record a default?

They have made me an offer to settle at 20% of the balance which on a 20k debt is a substantial reduction. I just don’t know what effect settling in this way will have on my credit file. 

stu12345_2

it can still go to default at any point, even with a cca request. the thing is if paperwork can't be found it means the creditor can't take you to court, ccj, the debt still exists, yes, but as essential paperwork is missed then as I said you can't be forced to pay up in court.
it would be flung out of court.
the creditor can still ask for payment etc, you can choose to ignore if you fancy.
thr offer for 20% makes me think the creditoi know they don't have the paperwork anyway and are looking to make some sort of money from you.

DullGreyGuy

smokey26 said:

If I accept this offer, what impact will it have on my credit file? I can only find information about partial settlement on defaulted accounts

can anyone advise please?

You'd expect them to mark the credit file as Partial & Final settlement. 

Obviously future lenders will know you will not be required to make any further payment towards that line of credit but that you never paid it off in full. Clearly they take that into consideration when deciding if to lend you more. 

Chasing_Squirrels

We get an 80% discount offer from Intrum most months for one of our accounts. This has been the case since the start of our DMP. 

I’ll accept it one day, but only because I know the debt defaulted and the plan was always to settle as cheaply as we could across all accounts. No plans to CCA this one as it’s unlikely to be reduced further and I don’t want to rock the boat. 

That’s just me though. I understand that without a valid CCA, you can just walk away if you choose…