Creditor offering 40% settlement deal

holidaypain

Hi,

One of my past high risk APR credit card debt collector has contacted me about a one off settlement figure on next payday and having the credit file marked as partially settled which I really do not mind and hopefully prevent me getting into trouble again in the future, just they want an income and expenditure form filled in? seems strange if making a one off payment to close. Is it to satisfy the financial regulator?

I'm due to lose my job in January 2026 due to end of contract. (I've known it was coming). The only internal vacancy going would give me another 2 months of employment so I'm unsure how it is going to go and how worthwhile trying to put numbers together in my current predicament at the mo. 

I thought it makes sense to get one less creditor off my back ahead of January whilst I can.

sourcrates

When debt purchasing companies offer such high discounts, its usually for a good reason, and nothing to do with regulation.

Either they consider the debt to be unenforceable, or the possibility that it might be, its passed the limitation period and could be statute barred, they may feel they will end up with nothing when your contract ends, or they may simply want to clear the decks as it were.

Any of those a possibility?

fatbelly

Settlement deals are usually available on defaulted debts. If you come into a lump sum it can be a good strategy. It's particularly a good way to finish off a debt management plan.

But if a creditor makes an unsolicited offer of settlement at 40% I'd be suspicious there was something going on, like no copy of the original agreement.

So I'd recommend a formal cca request

ManyWays

Rushing into accepting this if your job is uncertain is not a good idea. I agree with @fatbelly, ask for the CCA agreement for the debt. If it cant be found, you dont need to pay anything

holidaypain

Thank you.  I stupidly took the card out during lock-down. 

ahhh, I admit I would have always been high risk to them having defaulted before and did notice a very small mistake to my favour on the sum owed which seems never corrected. I'd been making random ad-hoc payments more or less until this year. 

Just thought it was my third strike of luck as we hit October.  Someone is definitely looking down on me this month.

First was my employer giving me an award for service above and beyond which I am so, so embarrassed about, then weekend just gone I received a letter from HMRC about under payment of tax credits when I was in a very low paid job found from like 14 years ago for quite a bit of money (the irony at the time I was first in debt to this creditor) and then Monday I get this offer through so it feels only right I use a bit of it towards it all. 

Rob5342

I agree, ask for the CCA first and if they can't produce that you can ignore it completely. If they can then think carefully about whether you can spare the money to accept their offer, there is often room fot negotiation and if you don't take them up on it now they will probably still be open to offers later on.