Starting monthly payments

Kittymumof4

https://forums.moneysavingexpert.com/discussion/comment/81861220#Comment_81861220

Yes, most of them have now I think. I'm confused about it all. Do they default before they're passed over to the debt collecting agencies? Some accounts have only just closed and one is closing soon. Is this the same a a default? We stopped paying all of them in June last year.

RAS

You need to find out the exact status of each debt and keep a record.

Go to each of the credit record agencies and find out the status of each debt. You can do this for free.

Creditors use the word default many times to refer to the fact you haven't paid as scheduled, not that they've issued a default notice to your credit record.

If a creditor has demanded that you repay the entire sum owed within a timescale, you are close to the default. It's a good idea to keep an old fashioned file with the letters from each creditor in separate sections, most recent letter on top.

Until the default is issued, legal action can't be taken, which is why you need to know the status of each account and to open mail regularly. Ideally, sit down once a week, read and file.

If you get any letter with a reply form come here immediately for help.

Kittymumof4

Okay thanks @RAS, I'll have a look this afternoon. I've separated letters according to which cc they refer to and have put them into separate plastic wallets with the latest letter on top. I know some say they have listed a default which will show on our credit file. Others say they have closed the account and we need to pay the full amount.

The ones that have defaulted, Wescot have sent letter asking us to contact them urgently and a letter titled confirmation of address. Do I need to respond to these now?

sourcrates

https://forums.moneysavingexpert.com/discussion/comment/81861482#Comment_81861482

Wow, you have got a lot going on here, now take a deep breath…….you will find all debt collection letters follow similar standard lines "contact us urgently" or "urgent response required" but really its not that urgent at all, they just want you to think it is.

So let me start by saying that all of the accounts currently managed by Wescott, you can ignore completely if you wish, for the time being anyway.

This is because Wescott have been engaged to simply collect your debts, they do not own the debts they chase, so cannot take any enforcement action themselves against you, so if you ignore them, there is nothing they can do, and will simply return the accounts back to the original creditors.

PRA Group on the other hand are a debt purchasing company, so have bought this debt, so you can go ahead and tell them what you will be paying them.

In time, all your accounts will default, you should get a default notice issued under sec 87(1) CCA, for each account, just file and ignore those, and allow the process for each to complete.

Most of your debts will end up being sold, I would wait until they are sold before setting up any payment arrangements, they want you to think this is a sprint, it isn`t, far from it, its more of a marathon, a long term effort on your part, so you have to know how to play the game, as that`s what it is, its just a game, and we can help you play this game to your best advantage.

Brie

@sourcrates @RAS

Hey there - can you post the link to post with the templates for checking on credit agreements and affordability? I couldn't spot them anywhere!! (need to go to specsavers…..)

Kittymumof4

https://forums.moneysavingexpert.com/discussion/comment/81861574#Comment_81861574

Thanks @sourcrates this is really reassuring.

So if I ignore Wescot for now, will it be worse in the long run if the debt is sold as the company may not be as easy to work with in terms of final settlements and accepting low monthly payments? I'm sick of the ph9necalls but keen to build more emergency fund.

sourcrates

https://forums.moneysavingexpert.com/discussion/comment/81861886#Comment_81861886

No, not at all, in fact debt purchasing companies can usually offer much better deals on settlements, because they buy these accounts for around 12% of their face value, so they have much more discretion in such matters.

And every debt collector/debt buyer should only be offered an affordable amount on a monthly basis, so if low payments are all you can manage, then low payments it is regardless.

The reason the likes of Wescott are keen on the phone calls is because they want to keep up the pressure on you, as they have no other way to make you pay, they know that as the debt has only been assigned to them on a "collection only basis" if you choose to ignore them, they won`t get paid, hence the phone calls 24/7.

Once your debts are sold, collection activity settles down to just a few letters now and again, this is because the debts new owner has the option of legal action if you don`t comply with them, Wescott don`t have that to fall back on, which is why they are like a Jack Russell on heat.

Its knowing the difference between these things that makes the difference for most folk.

SPM87

The first thing first here is for you to literally reset everything you think you know about bad debt. Assume nothing.

Then start thinking business like with your money. It is absolutely incredible how even the smartest individual, sometimes working in finance has absolutely no business sense when it comes to their own finances.

As sourcrates clearly states, they pay for your debt at 12% of the value (at most) so great news, you now know the real value to your new debt. You also learn than it is disgusting how you never got offered that deal but that is the situation. That should motivate you to realise you make these debt buyers sweat and treat them like sales people wanting your money. Most debts dont even get to court either, more good news. So dont be in this crazy rush to pay. Some of my bad debt still are not getting a penny off me 9 months from default. Some may never get any.