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    • Balood
    • By Balood 13th Sep 17, 4:11 PM
    • 4Posts
    • 0Thanks
    Paying debts off over next few months with FFS
    • #1
    • 13th Sep 17, 4:11 PM
    Paying debts off over next few months with FFS 13th Sep 17 at 4:11 PM

    I have approx 2700 in debt showing on my noddle account, most of are in default and dating back to 2013. There are 9 different debts range from 43 up to 543. I want to pay them off so I can clear my debt and start saving for my own home.

    What I was thinking of doing is taking 500 a month over the next and making Full and Final payment offers to a couple of creditors a month. Say offer the The 43 creditor 30 and the 543 Creditor 400. If they accept these offers I know that my creditor report will show "partly settled".

    So is this a good idea? Will the "partly settled" notices on my credit report have much of an effect of any future attempt to get a mortgage? Should I be really cheeky and offer the 543 a FFS of 300? This is still more than how much I originally borrowed from them.

    I want to deal with all my debts so I can get a self build mortgage in 3 to 5 years time.
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  • National Debtline
    • #2
    • 13th Sep 17, 5:19 PM
    • #2
    • 13th Sep 17, 5:19 PM
    Hi Balood,

    With full and final offers you should always offer the same percentage to each debt to ensure you are treating them all fairly and if you would struggle to do all of the offers at the same time, it may not be a suitable option. By doing a couple a month there is a risk this could be view as a preference payment. Essentially this means that the other debts (that have not had the settlement offer) may refuse to negotiate in the future, and may become more aggressive in enforcing the money owed.

    If you can raise the funds to do the partial settlements then you can put the proposal to the debts. They would all need to accept the terms of the payments in writing before you send any money and they would normally agree to mark the debt as partially satisfied if the debt has already defaulted.

    A partially satisfied debt is better than an outstanding default, but not as good as a fully satisfied debt. This may have a negative impact on your file and could affect your ability to obtain more credit, but it is difficult to say if that impact would be enough to stop you getting a mortgage. The older the information is on your credit file, the less affect it should have on your overall rating. But mortgage lenders will consider additional factors, such as affordability, on top of the credit file. Good luck,

    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
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