Partial Settlements

[Dazo]

Apologies if this has been covered before but can some tell me what impact partial settlements will have on you credit file/score etc. I am in the process of trying to get final settlements with our credit cards and I know they are going to come back and say they can only mark it down as a partial settlement.

[cerberusalert]

Your credit file wil be marked as 'satisfied' with a special flag to show that you have made a partial settlement, in my opinion that's as bad as having a default because it tells creditors that it has not been fully paid.

 

When making a settlement it is always worth trying to negotiate that any adverse information is removed from your file, but that would all depend whether you had some leverage such as an unenforceable agreement.

[Dazo]

Your credit file wil be marked as 'satisfied' with a special flag to show that you have made a partial settlement, in my opinion that's as bad as having a default because it tells creditors that it has not been fully paid.

 

When making a settlement it is always worth trying to negotiate that any adverse information is removed from your file, but that would all depend whether you had some leverage such as an unenforceable agreement.

 

 

Hi cerberusalert thanks for the rely, that's pretty much what I suspected. Trying to way up pro's and cons of accepting a partial settlement flag on my credit file. Obviously getting the credit card companies off my back being the major pro.

[cerberusalert]

It depends how old they are, don't forget if your file has a default(s) on they do drop off naturally six years from the default date along with everything else associated with it/them afterwards.

[Dazo]

It depends how old they are, don't forget if your file has a default(s) on they do drop off naturally six years from the default date along with everything else associated with it/them afterwards.

 

 

No default as yet and we have only being making reduced payments for a short while. However even on reduced payments we really need to get our outgoings down. My wife's family have basically offered us enough to pay off about 50% of our debt. So we are not sure on whether to over all the creditors a settlement whereby we will have no unsecured debt or whether to pay off all the credit cards in full and work our way through the rest.

 

How much damage is done to a credit rating when you have been on reduced payments but paid the balance off in full ?

[cerberusalert]

How much damage is done to a credit rating when you have been on reduced payments but paid the balance off in full ?

There shouldn't be any damage if there have been no defaults entered & it will be marked satisfied.

 

It depends on your circumstances as to which way to go, but in my opinion it would be better to clear those where you are paying the most interest and then start concentrating on the others getting rid one by one.

 

Have you paid a lot of charges on any of these a/cs? If you have you could send them a SAR to see what unfair charges have been added which you can reclaim thus reducing the overall amount due.

[Dazo]

There shouldn't be any damage if there have been no defaults entered & it will be marked satisfied.

 

It depends on your circumstances as to which way to go, but in my opinion it would be better to clear those where you are paying the most interest and then start concentrating on the others getting rid one by one.

 

Have you paid a lot of charges on any of these a/cs? If you have you could send them a SAR to see what unfair charges have been added which you can reclaim thus reducing the overall amount due.

 

Will the credit file not show I was on reduced payments or does this disappear when the debt is satisfied ?

 

I agree with your thoughts on paying the highest interest debts first. I will have paid some charges on those cards but to be honest I am not sure how much that would have been. 2 of the creditors have been extremely helpful during our struggle so I was not even going to bother with claiming the charges back and just pay them off. However it may well be a few hundred pounds and at these times every penny counts. The other credit card is with MBNA and to be honest the thought of paying these guys a penny really sticks in my throat. They have been as unhelpful as humanly possible.

 

Thanks for taking the time to reply. I think I may go down the SAR route and see what I am due.

Edited July 12, 2009 by Dazo

[cerberusalert]

Your credit file should just be marked settled.

 

There is nothing to prevent you from paying them off & then sending a SAR to determine what charges you can reclaim as long as it's within six years.

 

MBNA are typical a 'merkins', they have the philosophy that UK law doesn't apply to them & they will be the most difficult to deal with. Also they wouldn't think twice about defaulting you if you start standing up to them.

[Dazo]

Many thanks again cerberusalert.

 

Does anyone have the correct address for a SAR to MBNA ?

Edited July 12, 2009 by Dazo

[cerberusalert]

If you ask on the MBNA forum someone will be able to help; MBNA - The Consumer Forums