partial settlement v full and final

[tifo]

when a DCA buys the debt, they satisfy it with the bank, hence you have no more debt with the bank, otherwise they would be chasing you.

 

i have tried to use this point many times over the past few years (with no success) as the DCA pays a consideration for the debt and the rest is written off by the bank (tax relief claimed etc). Therefore it no longer exists. But the DCA then asks for the full amount, which is made up of the price it paid for the debt plus the amount written off by the bank. If you don't pay, it can sell the debt to another DCA and write off what's left after the purchase price (tax relief claimed etc). The same debt has been written off two times (or more) and this cannot be right, can it?

 

i have argued (again without success) that the DCA is only entitled to the price it paid plus interest as per the agreement, nothing more, same as a bank charges interest. It is not entitled to ask for money the bank has written off. If no proper agreement exists, then it must forego the interest and if the debtor pays the price the debt was sold for, the DCA has not lost out at all.

[pedross]

I am feeling better again now thanks to Kraken 1 so I will have another go.

Do not get confused between legal issues and commercial issues.

When the DCA buy the debt they buy the benefit of the whole debt outstanding and they should do so legally. It does not satisfy the lenders debt as such but the lender has decided commercially that it is the best option. Again it is a commercial action in claiming any losses made and writing the debt off in their books. It is nothing to do with us as the debt has been transferred in full to the DCA and regardless of how much they paid we owe them the whole amount.

The debt does still exist in full and is now owed to the DCA. The debt with the lender has gone. So, only one debt is still outstanding. I believe that is the legal situation.

Ethically, I understand your frustration and if they are going to sell the debt for 10% or whatever of its value why don’t they offer it to the borrower first? Well of course that would be commercial suicide because word would soon spread and we would all want to pay just 10%. So the DCA has to make a profit and away we go again.

So we must soldier on and play the cards that we are dealt. Luckily, thanks to this forum we get dealt some very good hands.

Life’s a gamble - play on.

Pedross

[diddydicky]

Let’s see if I can get something right before the day ends.

The way I see it is that as pt says there is a debt, whether it is enforceable or not is another matter. The debt is owed to the credit card company who is the creditor. If they choose to sell it to a DCA at a lower value then they are allowed to do so as the debt belongs to them. It does not satisfy the debt but the money is now owed to the DCA

Again pt has the answers with the case law and I believe the point is well made.

This is different. The debt is £1000 and they buy the liability for it for £1. This does not satisfy the debt because the debt is still £1000 but they are claiming that legally it is now owed by Rankine or whoever.

The million dollar question is: have they found a legal loophole to transfer the debt and I don’t believe that they have. Nor do the OFT by the look of it.

Time will tell

Pedross

 

ow is the debt settled with the bank?/

 

There is a clause in EVERY credit card agreement that says the creditor can assign the debt but the debtor cannot

 

the debtor can "sell his part of the agreement to ten different people at a quid a time or 10 quid a time it makes no difference to the lender he will still have the agreement with you"

 

in other words the proposition that one can simply releeve oneself of the debt by selling it (even at its full face value) is mickey mouse pie in the sky nonsense

 

the rankines are operating a " we can get rid of your debts" [problem] and are trying to do it using a different "tack"

 

 

they have already done enornous damages to the rest of us- dont care a hoot about anyone other than themselves and are in it to make a fast buck

[pedross]

I agree completely diddydicky

 

I am not saying the debt is settled with the bank I am saying that the bank no longer owns the debt. So no debt with the bank only with the DCA.

[diddydicky]

I agree completely diddydicky

 

I am not saying the debt is settled with the bank I am saying that the bank no longer owns the debt. So no debt with the bank only with the DCA.

 

ive got the feeling that you and i are talking at corss purposes

 

we are discussing debtors selling their debt to the rankines NOT banks selling the debts to dcas

 

In the case of the former of course the bank still owns the debt because a debtor CANNOT sell his debt to the rankines

 

most credit agrements contain a clause allowing the creditor to sell the debt

[Kraken1]

when a DCA buys the debt, they satisfy it with the bank

 

no, they don't, they buy an asset, that asset is a debt, like you buy a car. Just because you buy a car does not mean that it ceases to exist.

 

They are purchasing the right to manage that asset, and this involves seeking to recover it.

[pedross]

You are right dd

 

Lets try again.

 

I 100% agree with you about the Rankines.

 

Its just that there are other posts on here that I was trying to comment on as well like the one by tifo at the top of the page.

 

Please bear in mind that you are much more used to posting comments on this forum than I am and I am just trying to help others. I will work out how to put the quote in like you and Kraken1 do then it will be clear which post I am referring to.

 

The thing is I am just as passionate as you are about this debt purchase '[problem]' as you call it and although I did not really have time to post I could not resist. I knew what I meant!

 

Pedross

[diddydicky]

You are right dd

 

Lets try again.

 

I 100% agree with you about the Rankines.

 

Its just that there are other posts on here that I was trying to comment on as well like the one by tifo at the top of the page.

 

Please bear in mind that you are much more used to posting comments on this forum than I am and I am just trying to help others. I will work out how to put the quote in like you and Kraken1 do then it will be clear which post I am referring to.

 

The thing is I am just as passionate as you are about this debt purchase '[problem]' as you call it and although I did not really have time to post I could not resist. I knew what I meant!

 

Pedross

 

LOl i had the same problem as you- so what you do is to first click on the blue box marked "QUOTE" which is on the bottom right of the post you want to refer to and then type your response as normal then submit reply

 

simples innit!

[Rhia]

Sorry but I think I must be a bit dense but if they buy your debt off you (and say for the sake of argument they can) and that debt is £1,000 they now owe £1,000 instead of you. So how is that a good business deal?

The only way this works is if they know the debt is totally unenforceable and they trouser the £350 fee plus whatever..YES?

However, officially your name is still on the debt so if they don't pay it back it's you the OC will be after. I have never heard so much rubbish in my entire life.

[Trudy B]

The latter part of this article is quite interesting

 

TV couple's Credit Card Killer debt-buying offer - Rankine | This is Money

 

T

[diddydicky]

Sorry but I think I must be a bit dense but if they buy your debt off you (and say for the sake of argument they can) and that debt is £1,000 they now owe £1,000 instead of you. So how is that a good business deal?

The only way this works is if they know the debt is totally unenforceable and they trouser the £350 fee plus whatever..YES?

However, officially your name is still on the debt so if they don't pay it back it's you the OC will be after. I have never heard so much rubbish in my entire life.

 

spot on Rhia

 

its just another slant on the give us 395 quid and well clear you debt [problem]

[Rhia]

I take it you mean the bit in the article where the contract law expert says the Rankines are technically correct about the loophole created when a credit card company cancels your card and before they call in the whole debt. She also says she can't see how it will work.

Nope if it looks like a [problem] and walks like a [problem] and talks like a [problem]...it's a [problem].

[diddydicky]

no i mean the bit these **** taking people already in debt for a ride

[diddydicky]

I take it you mean the bit in the article where the contract law expert says the Rankines are technically correct about the loophole created when a credit card company cancels your card and before they call in the whole debt. She also says she can't see how it will work.

Nope if it looks like a [problem] and walks like a [problem] and talks like a [problem]...it's a [problem].

 

because long before that stage you have already parted with your hard earned cash and the rankines, being honest upright citizens will only be too keen to recompense you when the creditor doesn't terminate

[Tricky Dickie]

The latter part of this article is quite interesting

 

TV couple's Credit Card Killer debt-buying offer - Rankine | This is Money

 

T

 

looks like the game is up for the Rankines anyhow having had their MoJ authorisation cancelled.

I feel sorry for people who have been taken in

[rennuz]

HI All,

 

I am looking at potentially going into a debt management plan, payplan or CCCS. I have a fair bit of unsecured debt and the biggest amount is the de-linked part of my old Northern Rock together mortgage. Essentially I owe them £30k but the interest rate is now around 13% and this is the one that is putting me over the edge. £340 over 23 yrs....... £3400 in interest every year....

 

Thing is there is no point in me going into a debt mgmt scheme if I am not going to get the interest freezed. Has anyone had experiences of their dealings with Northern Rock, have they accepted and frozen your interest, was it hard work?

 

I know after speaking to them they are likely to try and get a charging order my house it has no equity in it and its owned by myself and my fiancee. Her credit is fine and she owes nothing, shall I get my mother in law to put a second charge on it are they likely to succeed?

 

Also I don't want the hassle of going to court etc if they do not accept my debt man plan, I hear this has affected a few people on here. Defaults etc are OK but when it starts to get to CCJ's that is not good, I am in the Financial Services industry and this really is a last resort as we speak I have good credit and with help of family etc I could put some of this debt on 0% for a while but its the monthly amount of £1400 to debt that is killing me and chopping and changing could come to a head anyway and push me into this.

 

Northern Rock are the ones that I am really concerned about will they actually be a nightmare in all of this, any help is much appreciated.

[rennuz]

My Situation is that I went into a Debt mgmt program in Dec/Jan time with CCCS, I owe £71k to 6 creditors.

 

I want to try and offer settlements to all them all to get rid of the debt. I paid £400 to clear a Nationwide credit card of £1515 and if my missus has offerred to get a loan for me to pay off the others. Written to them all told them I am emmigrating so take the offer or you will never hear from me again.

 

Have I made a school boy error though, Nationwide confirmed the settlement in writing but it is a partial settlement, they have saids they will never go after me for the debt but can I believe that? Really should I be asking for a full and final settlement, which would be great but realistically am I going to get a full and final settlement for 25% of the value.

 

Also what can happen with a partial settlement I know its on my file for 6 yrs so suppose full and final would be better but what else can happen with a partial settlement, can they sell the debt on come after me at a later date???

[rennuz]

OK, I am now in negotiations with MBNA to sort out a credit card of £4800, they accepted £1350 but after speaking to CCCS they have said I need to be equal in my offer to all creditors. Which means I can offer £1155 to them.

 

I said can you make sure this is a full and final settlement, they have said that is impossible and they have said that if they write of £3k then they have to say to the financial ombudsman that this is full payment of debt and becasue it essentially isnt then they have to pay back the amount outstanding i.e. £3k back. They were not clear exactly to who but said they never offer full and final settlement.

 

Is this a true explanation does it really make a difference whether they say its a full and final settlement to a partial?

[rennuz]

I owe Egg £4080 roughly, owe £71k in total. Anwyay sent Egg a letter saying I am offerring them a full and final settlement of £1000. Done the same with all the other creditors.

 

Called Egg today they said they would normally only accept an offer of 75% or £3k. No way I am paying that much, with CCCS at the moment. Anyway has anyone had any experience of a full and final settlement offer from Egg. I have done CCA request and its touch and go whether my card is enforceable and in all honesty I would rather pay £1k than go through all that hassle as I may not win in court. £1k is a reasonable offer right?

[exasperated]

Hi rennuz,

If Egg settle for the £1000 be sure to post back so we all no their limit, I have been trying to settle with them for ages and they are always playing hardball and we are up to 20%(with my parents money).

Good idea for a thread though as other caggers will benefit from it if we know what the EGG settle limit is

[Hardupnotfedup]

OK, I am now in negotiations with MBNA to sort out a credit card of £4800, they accepted £1350 but after speaking to CCCS they have said I need to be equal in my offer to all creditors. Which means I can offer £1155 to them.

 

I said can you make sure this is a full and final settlement, they have said that is impossible and they have said that if they write of £3k then they have to say to the financial ombudsman that this is full payment of debt and becasue it essentially isnt then they have to pay back the amount outstanding i.e. £3k back. They were not clear exactly to who but said they never offer full and final settlement.

 

Is this a true explanation does it really make a difference whether they say its a full and final settlement to a partial?

 

What CCS are saying is that they believe that all creditors are treated equally, by say offering all of them a pro-rata payment.

All you can do is insist that they mark your credit file as settled.

Your initial offer letter should be a Without prejudice offer with your conditions laid out clearly.

It is common practice for people to offer F&F OFFERS so I do not know what CCS are talking about'

[rennuz]

OK so they have accepted 20% of your bill as full and final? So they should accept 25% from me?

[rennuz]

Sorry this is what MBNA said, they are saying that they never put down full and final settlement if I do not pay it all becasue they have to then register it with the financial ombudsman. CCCS said try get full and final from everyone.

 

Has anyone had a full and final settlement with MBNA for a lot less?

[rennuz]

I am trying to negotiate a full and final with MBNA got it down to £1350 on a £4800 amount last week but I realised I really cant pay that much and £1150 is the max, trying to offer similar amounts to all creditors.

 

My accout went to CCCS in Feb, if I pay a full and final in next month I should stop them registering a default, although not really bothered if they do.

 

Anyway they have told me that they can only ever say my account is a partial payment unless I pay off the total owed. I said how will it really effect you if you put a full and final settlement? They said if they say its a full and final they have to tell the ombudsman and on their accounts it means they essentially have to pay it back??? I think they are trying to bluff me as N.Rock have just replied saying my payment will be a full and final.

 

Anyone else had a full and final settlement approved and not put as partial settlement on their credit file?

[rennuz]

I have had a full and final settlement accepted with N.Rock Its for 23% of the loan but on a £30k loan so a hefty amount, they accepted straight away, I am only making partial payments and have been since Jan. In all fairness this is the loan which tipped me over and convinced me to go into a DMP with CCCS. They didnt stop interest and just kept adding it on but have been very good in saying yes straight away to my settlement, they did always hint at a settlement.

 

My question is should I be cheeky and go for even less? I am getting the money as a loan.

 

Has anyone else had any dealings with them and has anyone got them to take a very low full and final settlement in relation to what they owe? My settlement is almost £7k so I suppose its a fair whack in anyones book.