Final settlement offer help

[floricita]

Hi,

 

I have many debts all of which are at quite an advanced stage. I.E. Threatening court actions. I am unemployed and have no money to pay them off.

 

I have spoken with my family about this and they are willing to give me some money to pay off the debts. However, it is not enough to pay off all the debts in total but not too far off.

 

I was wondering if it were possible and likely that these companies would consider a reduced final settlement offer? And whether some industries are more likely to accept than others? And what kind of % is considered reasonable?

 

The other point to note is that with some of the debts I actually dispute the amount owed. I.e some of the CC companies have been charging me £18 late fees and also some PDL. Do I have to resolve this before I offer them a final payment?

 

How best to proceed?

 

My debts are as follows

 

Capital 1 credit card total owed (£2300) £300 disputed fees

Cahoot credit card total owed (£1300) £600 disputed fees

Vanquis bank CC total owed £1900

Quick quid original amount taken out £1300 they say I now owe £1600

Payday express original amount taken out £800 (200 paid back but they have added more charges on)

Pay day uk original amount taken out £680 (£150 paid back but charges been applied )

Orange Phone £350

Accountancy firm £300 but dispute £200 of this.

 

Lump sum offered by family £7000

[i hate bailiffs]

when was the last payment made to each of these debts

 

check your credit file do they all show

 

Read the letters again they will say MAY IF not WILL

[floricita]

Hi, I haven't made payments for a few months now.

 

What do you mean by May and not Will?

[i hate bailiffs]

There letters will say we MAY take legal action and IF a CCJ .......................

 

I may have a beer tonight IF i don't fall asleep

[floricita]

Ok, yes they say may.

 

But the point is that I want to settle this now I have been given the opportunity, I don't want to drag it out. Just wondering the best way to proceed (see 1st post for details)

[i hate bailiffs]

Ok with settling for a reduced amount you have to make sure they do not sell on the discount as they can come back and bite later on

 

sounds like you could CCA the credit cards and think about reclaiming the fees if you don't have the statements a SAR would be needed

[oleg]

If you have no assets they're most unlikely to take you to court. If they did and you are on benefits, the court would almost certainly order only that you pay £1/month. Until any improbable court hearing, you would just continue to receive a deluge of threatening letters, but they can safely be ignored - just hot air. After 6 years of no payment and no acknowledgment, the debts become statute barred.

Alternatively, as you owe less than £15K, you could have your debts annulled by way of a Debt Relief Order, a process which you can start as soon as you wish.

Best wishes

Olég

Edited January 17, 2013 by oleg

[floricita]

Hi. It is my understanding that DRO is only applicable until your circumstances change. I expect and hope to be in employment relatively soon as of which time I will still have these debts with interest.

 

I have been offered a way out as this 7k loan would be interest free from my family and would prefer to try and get all of the debts settled now so I'm not constantly in the cycle of debt.

 

Is it likely that these companies would accept a reduced offer of settlement going by history?

 

How best to proceed?

[oleg]

With a DRO creditors can't take action against you during the 12 months after the order is granted, at the end of which period the debt is extinguished. It no longer exists, regardless of your circumstances.

[floricita]

Thanks for the advice. My understanding was that if you meet the criteria now you may be issued it but if you for example get a job during the 12 month period and you no longer meet the criteria you no longer can be part of the arrangement?

 

I was more keen to discuss however, people who have had experience with final settlement offers at a reduced rate

[The Mould]

Thanks for the advice. My understanding was that if you meet the criteria now you may be issued it but if you for example get a job during the 12 month period and you no longer meet the criteria you no longer can be part of the arrangement?

 

I was more keen to discuss however, people who have had experience with final settlement offers at a reduced rate

 

I would suggestthat you simply write a short letter to each of your creditors setting out thatyou would like to settle the account held with them and that you are willing tooffer £x amount in full and final settlement of the same without any admission of liability to the amount claimed thereon.

State that a thirdparty has raised the funds to enable this settlement offer to be made.

Request theirwritten response to your settlement offer within 21 days of receipt (this allowsample time for your creditor to consider you offer). State that if they accept your settlementoffer within the time scale, you can arrange for the said payment to bedelivered within 14 days of receipt of their written acceptance letter.

State that inaccepting your settlement offer, they agree to close the account, cancel anyagreement related thereto and make an entry on all 3 credit reference agencyfiles to reflect that the balance is £0 and the account is closed &settled.

Forexample offer:amount claimed by one of your creditors = £1300; you dispute this and you claimthat you owe £700, therefore, offer the £700 in full and final without anyadmission of liability to the amount claimed. (and so on with all of yourcreditors)

Do notmake any full and final settlement arrangements over the telephone, keepeverything on the subject in writingonly, send your written letters by Registered post and do not, under any circumstances,send any cheque payment with your offer letters, only ever send a chequepayment in full and final when you have written confirmation of acceptance asto your settlement offer from your creditor(s).

I am unable to editthis post, so please forgive any lack of spacing.

I hope theforegoing is helpful to your situation.

Kind regards

The Mould