FF settlement on debt not default

feekerry wrote: »

Hi

I’m trying to clear my dmp, I have 2 defaulted debts and 3 that show as up to date but marked DM (debt management) all are with debt collection companies. If I offer and get accepted for a partial settlement, what happens with the 3 that aren’t defaulted? I know the defaulted ones would show as partially settled and drop off 6 yrs from default? But what would the others show as and for how long?
Would they show as partially settled for 6 yrs from the day I made the f and f?

Yes partially settled, that’s correct.

Hi feekerry,


The debts will show for 6 years from the default date or settlement date if they have not defaulted. A partially settled debt can be positive and negative to a credit file. It shows that you settled the account (which is good) but that the account was not settled in full (which can be negative). It will not specify how much you paid and this can be an issue for future lenders.

Whilst fully settled debts would be more positive, I worry this may be hard to do in practice. You need to treat your debts fairly, if you don't this is known as a preference payment and if the debts that receive a partially settlement become aware that you have made a full settlement to other debts, they may refuse to negotiate going forward and/or become more aggressive in taking action.


If you can pay all of the debts in full then this would be best, but I appreciate that is not always achievable. Best of luck,


Laura
@natdebtline