Full & Final Settlement Offer

[Chris4918]

My Fiance and I have recently had a property repossessed and owe £41,000 to the mortgage lender. When we received the first phone call chasing the payment or suggested payment plan we were told that the lender may accept a lump sum payment to close the account down. This sum was in the region of £7,000. Due to the arrears and subsequent repossession we have fallen behind on other payments (Egg & HSBC loans). We had spoken to an IVA company who not only wanted to charge us a fortune for their help but told us we would still be paying out for years to come. They did however advise us that most companies will take a lump some payment of around 25% of the outstanding loan amount (HSBC will want 40%).

 

We have since been speaking with family members who have offered us £15000 to try and clear all the debt before we end up going bankrupt. It breaks down as follows:

 

Mortgage owed £41,000 - Offered £7,000

Egg Loan owed £11,000 - Offered £3,200

HSBC owed £8,000 - Offered £3,500

 

As you can see apart from the mortgage offer, the other two offers are over what we were advised by the IVA company.

 

Has anyone here had any previous experience in this and what are our chances of having these offers accepted?

 

Thank you,

Chris

[Malakorah]

Hi there Chris,

 

I am no expert in these matters but i am sure someone will be along shortly to give you some sound advice. As for the IVA company i have found these to be a complete rip off as the 'Consumer Credit Counselling Service' offer the same assistance free of charge ( it is a registered charity for people suffering eith aspects of debt)

Why not give their website a browse and at least chat to an advisor (this would only help with unsecured debt i think although they may give advice on your secured debt also)

Hope this helps:)

Hang in there and keep checking this site, i am quite new to it but i have read many success stories on here and loads of support:D

[Chris4918]

Thanks for your response.

 

I actually have a plan with the CCCS at the moment for debts in my name. They started at around £28,000 and now down to around £15,000 so this is being paid off slowly.

 

My Fiance has the 2 loans with HSBC and Egg in her name only and the £41,000 owed to the mortgage lender is in joint names. I actually had a response from the DC regarding the mortgage today in response to the £7,000 offer we had made. They have come back with a counter offer of just over £10,000 but i have had to tell them that we can only come up with £7,000 otherwise we will have to go BR and then they won't get anything! Just need to wait for their response tomorrow.

 

What i really need to know is what sort of percentage the lenders will accept as a settlement figure especially if they realise that we are considering bankruptcy.

 

Thanks,

Chris

[Malakorah]

Hi Chris,

I should think that if 7,000 is what you can afford then they possibly may accept it as refusing you could possibly leave them with nothing!!

Also it looks good on you to have made the offer even though it would place you in financial hardship etc etc.

Wait for your the reply tomorrow and let us know what happened but remember at the end of the day they must realize if you go for bankruptcy they will end up with nothing so my gut instinct is they will accept the 7,000

Just out of interest has your partner not thought of getting an IVA through the CCCS to deal with the Egg and HSBC loans as they are seperate from yours?? Even if this stopped the interest and charges accruing?

I hope it all works out for you both you should start getting some more experienced caggers helping you tomorrow:)

[Chris4918]

I have received a letter from them today... (although i never actually offered £8000 it isn't too bad)!!...

 

 

 

Dear Sir and Madam,

Our Client: Oakwood Homeloans Ltd

Current Balance Outstanding: £40,948.82

With reference to the above matter, we can confirm that your offer of £8,000.00 has been accepted by our client in full and final settlement of your personal liability.

This is provided that cleared funds, of £7000.00 are received at this office by 19 March 2009. You will also need to make a payment of £1000.00 by 24 monthly instalments to start on 01 March 2009. A standing order mandate form has been enclosed for your use.

On receipt of your full and final settlement payment we will notify our client and all relevant credit reference records will be amended accordingly.

Please note that should this agreement be breached, our client reserves the right to seek from you the full balance outstanding plus interest and costs.

Yours faithfully

Optima Legal

[Talbot]

Can I just check you spoke to them yesterday and you received the letter today?

 

Seems very quick for these sort of characters plus they have agreed near enough to your offer very quickly without threatening to take you to court etc. Don't want to throw cold water on it but it seems to good to be true just be very wary what you sign. The letter they sent looks ok BUT i am no expert so get it checked by someone more clued up than me on here. They usually try to take it as a part payment and then chase you for the remainder later down the line.

 

If it's all ok and others agree it seems like a good deal IMHO:)

 

I will keep checking this thread to see how your going. Good luck.

[Chris4918]

I asked them to put the letter in the post but scan and email me a copy first. They have been chasing for weeks and we kept ignoring the calls, so decided to write them a letter offering a lump some to clear it. We offered £7,000 but they wanted £15,000, I offered to £7,000 again and they then came back with an ofer of £10,200. I told them if they didnt accept it then i would have no choice but to go BR. This is why they are happy with £7000 up front and another £1000 over 2 years. I am happy enough to pay £8000 up front to close the matter!!!!

[Talbot]

Be careful, if you offer 8000 they may think you access to more money. Ask some of the others on here but i wouldn't offer 8k up front if all you said you had was 7k.

 

But it does look like a good deal unless anyone says otherwise, let me know how you get on with the other F&F debts.

 

I am about to go down the same route myself:)

[Talbot]

Any further developments with them, anyone else got any thoughts on this?

[gizmo111]

It looks like a good deal.

[Talbot]

I asked them to put the letter in the post but scan and email me a copy first. They have been chasing for weeks and we kept ignoring the calls, so decided to write them a letter offering a lump some to clear it. We offered £7,000 but they wanted £15,000, I offered to £7,000 again and they then came back with an ofer of £10,200. I told them if they didnt accept it then i would have no choice but to go BR. This is why they are happy with £7000 up front and another £1000 over 2 years. I am happy enough to pay £8000 up front to close the matter!!!!

 

 

Any further developmets on this chris4918, interested to see the outcome????

[Chris4918]

I spoke to a few family members who could help out with the other £1000. I asked Optima Legal what would happen if i could come up with the additional £1000 and he just said it meant the case would be closed quicker and we would have settled the matter.

I made a payment on Saturday of £8000 in full and final settlement. I had a 3rd party transfer the money for me as advised by different forums.

All should be fine now but will definitely let you know if it goes 'pear shaped'.

 

£42000 down to £8000. It's all about hanging on and sticking to your guns (even though i did have to increase by £1000!!!)

 

Thanks.

[Talbot]

Thats great news, can you post the letter which confirmed the deal so we can use as comparisons?

 

Well Done;)

[Shadow2009]

Hi

That's fantastic news. We are about to start the same but owing 70k. Can you give me any hints or tips as we have no money available for lump sum etc but would go cap in hand to relatives if we could get it down to a sensible amount. Please see my postings and thanks in anticipation.

[jimbo45]

Hi there

If you've been re-possessed and there is a shortfall I can't see why you should pay ANYTHING in spite of waht the law says -- what can they do --presumably no other assets they could levy so just tell them to stuff it.

 

Bailiff's cant seize anything worthwhile and if they go for Bankruptcy it will COST THEM plus you'd get off the credit card / other debts too.

 

I really in spite of what the law says would just tell them to Foxtrot Oscar -- meanwhile move your money to a "Parachute Bank" and if they really do threaten Bankuptcy then "Cash under the Matress" for a while before any hearing.

 

Actually in this case Bankruptcy isn't a bad idea -- 70K written off straight away. You don't own another house they could seize otherwise there already would have been a CCJ and Charging order on it.

 

The USA seems to have a more realistic approach to this -- the debt is tied to the PROPERTY not the person so if a property is repossessed that's the END of it.

 

Cheers

jimbo