Great payment record BUT need to make 80% F&F settlement offer!

Baggy_matty

Hi All!

My predicament is this:

My partner and I have just split. I have now become the sole occupant of the house (and the only person paying the mortgage). However, this is not the problem..

The main issue is that I have been left with 24.5K of shared unsecured debt which, although I have never missed a payment, I can make no further payments. Although I can raise £19-20K which could be used as full and final settlement offers. BUT!! I have a great payment record so I am unsure that my creditors will be receptive.

I am a lone parent of two children - does anyone know if the could increase the chances of a successful full and final settlement offer?

I do not want to do this in a way that affects my credit rating as, to make things worse, my fixed rate mortgage expires this year and I need as good a credit score as possible!!

Has anyone been in this situation before? Any help greatly appreciated!

SOA follows

Monthly income after tax................ 2240
Partners monthly income after tax....... 0
Benefits................................ 440
Other income............................ 0
Total monthly income.................... 2680

Monthly Expense Details
Mortgage................................ 1100
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold flat)...... 0
Council tax............................. 120
Electricity............................. 100
Gas..................................... 100
Oil..................................... 0
Water rates............................. 25
Telephone (land line)................... 40
Mobile phone............................ 0
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 400
Clothing................................ 60
Petrol/diesel........................... 200
Road tax................................ 10
Car Insurance........................... 35
Car maintenance (including MOT)......... 50
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 40
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 100
Haircuts................................ 5
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 2397

Assets
Cash.................................... 0
House value (Gross)..................... 230000
Shares and bonds........................ 0
Car(s).................................. 17000
Other assets............................ 0
Total Assets............................ 247000

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 185000...(1100).....5.2
Total secured debts........... 185000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Credit Card....................5500......25........15.9
Loan...........................5000......200.......12
Loan...........................14000.....265.......8
student loan...................3800......55........0
Total unsecured debts..........28300.....545.......-

Monthly Budget Summary
Total monthly income.................... 2,680
Expenses (including secured debts)....... 2,397
Available for debt repayments........... 283
Monthly UNsecured debt repayments....... 545
Surplus(deficit if negative)............ -262

Personal Balance Sheet Summary
Total assets (things you own)........... 247,000
Total Secured debt...................... -185,000
Total Unsecured debt.................... -28,300
Personal net worth...................... 33,700

Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.[/font]

IWantToBeFree_2

Baggy_matty wrote: »

Hi All!

My predicament is this:

My partner and I have just split. I have now become the sole occupant of the house (and the only person paying the mortgage). However, this is not the problem..

The main issue is that I have been left with 24.5K of shared unsecured debt which, although I have never missed a payment, I can make no further payments. Although I can raise £19-20K which could be used as full and final settlement offers. BUT!! I have a great payment record so I am unsure that my creditors will be receptive.

I am a lone parent of two children - does anyone know if the could increase the chances of a successful full and final settlement offer?

I do not want to do this in a way that affects my credit rating as, to make things worse, my fixed rate mortgage expires this year and I need as good a credit score as possible!!

Has anyone been in this situation before? Any help greatly appreciated!

SOA follows

Monthly income after tax................ 2240
Partners monthly income after tax....... 0
Benefits................................ 440
Other income............................ 0
Total monthly income.................... 2680

Monthly Expense Details
Mortgage................................ 1100 Switch interest only for a while?
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold flat)...... 0
Council tax............................. 120 Is this spread over 12 months or 10?
Electricity............................. 100 Your gas and electric seems huge... Can you switch providers, preferably via quidco for cashback?
Gas..................................... 100
Oil..................................... 0
Water rates............................. 25
Telephone (land line)................... 40 Can you cut back on this?
Mobile phone............................ 0
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 400 £400 to feed 3 mouths is huge, use the oldstyle board to cut this back
Clothing................................ 60 Can you cut this back whilst you are strugglig?
Petrol/diesel........................... 200
Road tax................................ 10
Car Insurance........................... 35
Car maintenance (including MOT)......... 50
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 40 Seems high, when is your renewal date? Switch via quidco for cashback
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 100
Haircuts................................ 5
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 2397

Assets
Cash.................................... 0
House value (Gross)..................... 230000
Shares and bonds........................ 0
Car(s).................................. 17000
Other assets............................ 0
Total Assets............................ 247000

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 185000...(1100).....5.2
Total secured debts........... 185000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Credit Card....................5500......25........15.9
Loan...........................5000......200.......12
Loan...........................14000.....265.......8
student loan...................3800......55........0
Total unsecured debts..........28300.....545.......-

Monthly Budget Summary
Total monthly income.................... 2,680
Expenses (including secured debts)....... 2,397
Available for debt repayments........... 283
Monthly UNsecured debt repayments....... 545
Surplus(deficit if negative)............ -262

Personal Balance Sheet Summary
Total assets (things you own)........... 247,000
Total Secured debt...................... -185,000
Total Unsecured debt.................... -28,300
Personal net worth...................... 33,700

Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.[/font]

In my experience, creditors are far more unlikely to accept F&Fs when you haven't missed payments as they still assume they will get the full amount back. I rung Egg a few months ago to get a settlement figure on my loan and as I have never defaulted they wouldn't reduce it.

Baggy_matty

Thank for the saving advice. Gas & electricity are high due to the size of the house. But I am looking into reducing the other areas. CTAX is over 10 months.

My main worry is creditors throwing out F&F settlement offers - with such a gear-cruching change in circumstances there must be some sort of give on the creditors position.

IWantToBeFree_2

You'd think so wouldn't you, especially seen as an 80% F&F offer is quite high, people tend to start at about 35%, but thats after they've been in trouble for some time etc.

I would consider contacting one of the debt charities and see if they could offer you any advice, and I don't think there is any harm in explaining your situations to your creditors and seeing what their reaction is.

Baggy_matty

Just bumping this to see if anyone has successfully manged to get a reduced F&F settlement without having missed any payments...?

Gemmzie

Not really got any advice about the F&F apart from start low-ish and work up?

But I don't understand why you're clearing joint debts, your partner is liable too, and if F&F are not done exactly right they may chase them for the rest, or you in years to come.

CLAPTON

You have no need to do a F&F.

You simply use the 20k to repay 20k of your loans leaving you 4.5k of debt which your surplus can easily fund.

stapeley

CLAPTON wrote: »

You have no need to do a F&F.

You simply use the 20k to repay 20k of your loans leaving you 4.5k of debt which your surplus can easily fund.

good point ! job done !

stapeley

Pay off the highest rate ones , transfere the others to 0% .