In a Full and Final Settlement (F&F) a creditor agrees:
- to accept less than the whole amount to clear it (“full”), and
- that they won’t take action to recover the rest (“final”).
This is sometimes called a “partial settlement” and sometimes a “short settlement”.
You can offer a F&F to a creditor. Or a creditor may write to you to suggest an F&F. This usually happens if you have defaulted on the debt or have been in a debt management plan for a while.
Contents
You propose a Full and Final settlement
If you have a lump sum, then you can write to your creditors and offer a F&F.
You can do this yourself, there is no need to employ a solicitor to write a letter, that is no more likely to be accepted than an offer from you.
Where could the money come from?
The lump sum could come from:
- a refund that you get, for example from an affordability claim;
- a redundancy payment (make sure you will still have enough money to live on and pay the mortgage until you find another job);
- selling some assets, possibly even your house;
- an inheritance;
- it might be offered by a relative (do consider if your relative can really afford this – if your situation is close to hopeless, then it may be better to go bankrupt rather than take money from a relative); or
- if you are over 55, you might consider taking money from your pension if you can get your creditors to agree a low enough settlement.
It is usually a big mistake to try to borrow money in order to clear a debt that has already defaulted.
You don’t have to offer the same to all your creditors
If you don’t have a lot of money, it could be a good idea to use it to pay off one creditor.
For example, if you only have £1,000 then that isn’t going to get far if your debts add up to £24,000. But if you could get a creditor you owe £3,000 to take £1,000 then this is a good improvement.
When is an offer likely to be accepted?
A full and final offer is NOT LIKELY to be accepted unless you have already defaulted on your debts.
The longer you have been paying little or nothing towards them, the lower offer your creditors may be prepared to accept. I looked at this problem in Is it too soon for have good settlement offers?
How to make the offer
National Debtline has a sample letter that you can use.
It is a good idea to add an explanation about where the money is coming from.
A couple of examples:
“I have been offered £2,000 by my sister if this will help me clear my debt with you, which is currently about £4,650. “
“I am reluctant to take money from my pension, so I will only do this if you agree to accept this offer.”
Enclosing an income & expenditure sheet with your letter will make the point to the creditor that if they don’t accept this offer it will take a very long while to repay the debt.
That sample letter asks the creditor to confirm in writing that the money will be accepted as a Full & Final Settlement and also that they will not sell the remaining debt.
You need to insist on this. Unscrupulous creditors have been known to just take the money, reduce the debt then continue to chase you for the rest of it. In 2023, this is very rare but it’s simply not worth the risk! If a creditor calls you up and agrees to your offer, do not pay the money without a written agreement.
When you are in a debt management plan
A F&F can be great way to start getting the number of debts down in a Debt Management Plan. the remaining debts will then be paid off faster
Often your DMP company will say you have to offer the same to everyone, which is normally not going to work well unless you have a lot of money to offer.
So I suggest you don’t talk to your DMP firm about this but make the offer to some creditors yourself.
I don’t think this is being unfair to your other creditors – by clearing one debt, your DMP will then start paying more to the others.
An unusual case – a single payment IVA
If you have a lump sum to pay towards your debts but afterwards you are unlikely to be able to pay much at all on a monthly basis, then this could be a good option for you.
A typical situation might be if you have been made redundant and you are unlikely to be able to work again, perhaps because of your age or health. Or if you have downsized your house.
This gives you a Full & Final settlement on all your debts without having to negotiate with each creditor individually.
The downside is that this is a form of insolvency – it has the same bad effect on your credit record as bankruptcy for 6 years.
If you want advice on this, talk to StepChange, who could set one up and who will explain if you have better options.
Before making an offer…
Is the debt enforceable in court?
Think about this before making a settlement offer.
For loans, credit cards, store cards and catalogues, the debts are unenforceable in court if the current creditor (usually a debt collector) can’t produce the CCA agreement for the debt. See When and how to ask a creditor for the CCA agreement for more details.
This is most likely to work for old debts, especially those where the account was opened before April 2007. It’s also worth doing this for accounts that were opened more recently if they have been sold to a debt collector. It won’t work for overdrafts or mobile or utility bills.
If the creditor admits they can’t produce the CCA agreement, you could decide not to pay the debt at all. This is normally your best option.
You may think that the creditor will then accept a really low settlement offer. Unfortunately many don’t. completely sorted.
How low an offer will be accepted?
This is a really hard question to answer because it depends a lot on your circumstances. An offer may be rejected because it is too low, but if you give the creditor more information it’s possible that they could be persuaded if you can give them more information.
You have to put yourself in the mind of the creditor and try to work out what they will think – for more details read What to do if a Full & Final Offer Is Rejected.
For example, if you have been paying token payments for more than a year and your brother offers you half the amount you owe, then there is a good chance your creditors might be interested.
But if you have just lost your job, are young and healthy and have only missed a month’s payment, then your creditors are very unlikely to accept 50%… but you may be able to persuade them with 90%.
It isn’t good tactics to always start with a really low offer such as 10% if all the indications are that they won’t accept that. Your letter may just be binned if it isn’t somewhere close.
Realistically, a secured creditor is extremely unlikely to accept a low F&F if there is much equity in your property. And they are uncommon on debts where there is a CCJ.
Your creditor proposes a F&F
If you have been in a DMP for a while, or have not been paying anything, then you may receive a letter offering you a Full & Final settlement.
Klarna has said that it will offer 50% reductions to eligible customers who have missed payments for a long period.
Of course you may have no money to accept this offer… But if the offer is a good one it may be worthwhile taking a hard look at your situation (see the list of possible money sources above) to see if you have any options.
At this point it may be a good idea to negotiate, but there is no point in wasting everyone’s time. If they have offered you a 60% settlement, then it’s worth seeing if they will accept 40%, but not 10%.
Read their letter closely – is it clear that they are definitely writing off the remainder of the debt? If you are unsure, get them to clarify this in writing.
Your credit record & worries about a future mortgage
Debt collectors tell you that a partial settlement will harm your credit record and it will be there for 6 more years. The first is partly true – but often doesn’t matter – and the latter is simply wrong!
- A F&F usually results in the debt being marked as “partially settled” on your credit file. You may decide this isn’t important for you. Your credit rating is usually poor or dreadful if you are likely to get a F&F, and it’s sensible to decide that clearing your debts is your top priority. Whilst it would be lovely to get rid of the debts and improve your credit record at the same time, that probably isn’t going to happen.
- If the debt has a default date on your credit record, it will always drop off your credit file six years after that date. Making a Full and Final settlement will not affect this, the debt won’t stay there for longer.
- If the debt has already dropped off your credit record it will NOT reappear after a partial settlement.
This is discussed in more detail in How partial settlements affect your credit rating.
You may be worried about a future mortgage. I have looked at this here: Will partial settlement make it hard to get a mortgage?
For most people if they have to pay in full it will be many more years before they can get a mortgage… so unless you can easily pay the full amount, this probably isn’t something to worry too much about.
Summary of pros and cons
Pros Clears a chunk of your debts, leaving you in a better position to clear the rest faster.
Cons Your creditors don’t have to accept. You shouldn’t leave yourself short of money you need for living on. The debt will be marked as ‘partially settled’ on your credit file.
Debt Camel says Often you don’t have the money for a F&F, so they tend to be rare, but they are good options when they work for you.
Remember to keep the emails or letters
99 times out of a hundred, everything goes smoothly and you will never hear anything about the debt again after a F&F.
However just in case something goes wrong – perhaps your debt which is closed gets accidentally included in a lot of debts the creditor is selling to a debt collection agency – it’s a good idea to keep the emails or letters from the creditor confirming that your payment was a Full and Final settlement.
If you ever get any letters about the debt again, send them a copy of the letter or email where the creditor agreed to the settlement or proposed it. Keep these letters for at least six years, after which the debt would become statute-barred anyway.
Julie Judson says
Hi Sara,
I have a charging order on my property from a loan I defaulted on with Nationwide in the late 90s. This was placed on my house in approx 2005. I think I was paying about £2 a month to Drydens for a long time and then just stopped paying even that some years ago and have heard nothing since. I have (nearly) financially grown up considerably since then and someone told me to bite the bullet and contact them for a statement as they could be adding interest and I also couldn’t remember how much the original loan/credit card was for.
I contacted them and was told it was a loan for £4000 in 1996 and the amount is now £2700. My question is, would it be worth my while offering a f and f of approx. 50%? Would they even go for this as they could get the full amount if/when I sell my property? Any information gratefully received.
Sara (Debt Camel) says
There is no harm in asking!
Dan says
Hello,
I have debts of around £32000 majority on credit cards and one loan. I have defaults on all and have arranged a paypan plan with them myself. Would take 10 years to pay off.
Barclaycard £8000
Mbna £5000
Amex £8000
Tesco loan £4000
Paying montly between £20-£60 pm on them. Is it to early to ask for a F&F settlement if i can get some money from family and friends?
Sara (Debt Camel) says
when did the DMP start? Have all the creditors registered a default on your credit record yet? Have any of them sold the debts to a debt collector? And how much roughly do you think could be offered?
Dan says
Hi,
Payments to Amex, Barclaycard and loan one month ago and yes all have registered a deafult not sure about amex but with the regain program cancelled card and with debt agency NCO. Will make payment to MBNA from this month of around 35pm no payment made yet received default last week.
Im thinking i can borrow a maximum of £6000 from family. So 25% each. What do you recommend?
Would this enable them to issue a ccj as they may be aware i can borrow small amount from family and friends? Do i have a risk of CCJ at this point?
Sara (Debt Camel) says
I think you have no hope of getting a 25% offer accepted so soon after a DMP has started unless you can produce something unusual such as some evidence about long-term very serious health issues. Sorry, you need to sit back and wait for at least a year, probably longer. It will be a lot easier to get F&Fs accepted if the original lenders sell the debts to a debt collector.
“Would this enable them to issue a ccj as they may be aware i can borrow small amount from family and friends? ” no – why would a lender go for a CCJ because of that?
“Do i have a risk of CCJ at this point?” yes but it probably isn’t that large. You aren’t making token payments. Do you have a house with equity?
Dan says
Thanks Sarah this process is difficult and worrying and will continue making payments for the next 12-24 months. Am worried about a CCJ for some reason have received defaults in last 2 months and only arranged repayment plans this month.
No i am not a homeowner. Why do you ask?
Sara (Debt Camel) says
Lenders may be more likley to go for a CCJ if you have a house with equity that they can then get a charge over. Without a house, what would be the point?
But 10 years is a very long while for a DMP unless you have assets to protect. Do you have a car?
Dan says
no i do not have a car. Again why would that matter?
I have no assets to protect just want to pay the debt off with minimum impact to my credit file.
Dan says
Having read numeous posts im screwed for 6 years but aiming to clear all debts asap within 3-4 years not over 10 years if i can get a good settlement offer by cutting expenses over time and borrowing from friends and family small amounts.
I also have some payday loan cases with the ombudsman which im hoping can refund me £4-5k in interest.
Sara (Debt Camel) says
ok, well 4-5k back from payday lenders would increase the F&Fs a bit so that would help. But it still isn’t going to happen in under a year. You will be doing very well if two of the 4 lenders accept a F&F in the next three years.
Sara (Debt Camel) says
I asked because a car would rule out some insolvency options for you.
Your credit record is now pretty much wrecked for the next 6 years with 4 defaults on there. Getting these settled with F&Fs will not remove the defaults and will not increase your credit score. And it may take several years before your creditors are prepared to accept as little as 25% to settle the debts.
Did Payplan discuss alternatives to a DMP? In your case bankruptcy (an IVA would mean you pay more and the effect on your credit record is the same as for bankruptcy). In bankruptcy you would have to make monthly payments for three years, not 10. After 6 years bankruptcy and all the debts would disappear from your credit record. Financial help from family could be used to pay your bankruptcy fees and then act as a guarantor if you had problems renting during the 6 years bankruptcy is showing on your record.
Dan says
I do not really want to get into an IVA or Bankruptcy as these will affect my credit score for longer than 6 years.
Does the IVA and bankruptcy stay on record for 6 years also? Im scared of these options and would prefer not to enter into these. I will continue with the debt management plan for a few years and see what my options are in 24 months or so. Would having a self adminstered payment plan be better in the future? Im thinking this would allow me to have more control over payments and liaising and negotiating with creditors.
Your advice is much appreciated and the people you help on here for free is unseen in this modern world. You give your time and you do a good deed everyday helping and providing assistance. Thank you again and hope good deeds come to you in return x
Sara (Debt Camel) says
“I do not really want to get into an IVA or Bankruptcy as these will affect my credit score for longer than 6 years.” No they won’t. Well in theory the IVA one might if you have to have payments breaks in the middle, but normally both IVAs and bankruptcy drop off after 6 years. See https://debtcamel.co.uk/bankruptcy-iva-dro-credit-rating/ for details.
Also read https://debtcamel.co.uk/hard-choices/long-dmp-vs-bankruptcy/.
There is no desperate hurry and you are probably feeling very on edge at the moment. Settle down in the DMP, have a go and cutting your expenses, pursue your payday loan refunds and think again in a while, but perhaps a year, not two? If you do decide that bankruptcy is best, the sooner you get it over with, the sooner you are out the other side.
Thanks for the kind words :)
Christine Chan says
Hi Sara,
I was paying about £3.50 a month to the creditor a long time and then stopped paying June 2017 due to a serious car crash in Malaysia. Got back not long and received some letter from the creditor. Can I write to them to make an offer for F&F?
I got one from Wescot saying that the act on behalf of Royal Bank of Scotland Retail. Who shall I write to Wescot or Royal Bank?
Need some advice. Many thanks.
Sara (Debt Camel) says
Yes you can make a F&F offer. Write to Wescot.
Peter says
Hi Sara,
I have a DMP o/s balance of 17k circa. Been paying around 10 creditors for about 10 years at £152 pm. Still around 8 years left. Some of the debts are on my credit file marked as “on a DMP”. I could be given a sum of money (around 7k) and have offered all creditors around 40%. What I am trying to achieve is paying off the debts and improving my credit rating. I have some rather nasty credit card balances that I would like to (in a year or two) transfer to sum 0% balance transfers. My credit file is pretty good other than the DMP entries with no defaults. How will this likely help my credit rating? or is it worth me finding out if the debts are actually enforceable? how would that effect my credit rating.
Sara (Debt Camel) says
how large are the nasty credit card balances? are you buying or renting?
Peter says
Homeowner. 10.5k on the nasties. One of the creditors has asked if its a gift or a loan from the family member. Not quite sure if they are expecting a particular answer to be able to consider the offer
Sara (Debt Camel) says
Sorry I missed your reply.
The best thing to reply to the creditor is that the family member is offering the balance as a gift if it will enable you to settle your debts – if the F&F offers are rejected it will not be made,
Sara (Debt Camel) says
Repaying debts with a DMP marker will not improve your credit rating. It will close the debts which will then drop off in 6 years,
If some of your creditors accept your F&F offer, then fine. If any don’t then a better use of the money would be to repay some current credit card debt which will reduce the interest you are paying, so you can clear the rest faster.
For any creditors that reject your F&F, I suggest you then ask them to produce the CCA agreement for the debt (assuming it was a credit card, catalogue or loan – this won’t work for overdrafts, mobile bills etc). National Debtline have a good factsheet https://www.nationaldebtline.org/EW/factsheets/Pages/getting-information/credit-agreement-advice.aspx that explains what the CCA agreement is, how if a creditor can’t produce it they can’t enforce the debt in court, and they have a template letter to ask for the CCA. NB you have to send each creditor a £1 cheque or postal order.
If a lender can’t produce it – and with debts that old which have been sold by the original creditor it is a fair bet that some of them won’t be able to – then you can simply stop paying the debt as they can’t take you to court.
It is a pity all the debts weren’t defaulted originally – I suggest you ask the original creditor (not the current debt collector that owns the debt) to add a default to your record back before it was sold, see https://debtcamel.co.uk/debt-default-date/. That is your best chance to help your credit rating. But do this after sorting out the F&Fs and asking for the CCA agreement – too complicated to try to do this all at once.
Peter says
Thanks for this fantastic advise. Much appreciated. One further question; if I get defaults retrospectively added will this mean the debt drops off the credit file. Not entirely sure how this will help my credit rating?
Sara (Debt Camel) says
yes, if a default date is added that is more than 6 years ago the debt will immediately disappear from your credit record. That is removing a debt which currently has a DMP marker which is harming your credit record.
Any queries about CCA agreements and what you are sent by the creditor, National Debtline are the best people to talk to.
Dean says
Hi Sarah
I have an old debt that I’m paying £50 per month.. £3300 remaining..
This was from an old car finance that a family member trapped me in 2006..
In 2010 bailiffs came to my house (new address) and demanded money. Anyway that family member stopped making payments. I received a CCJ in 2010. So from 2010 I started paying £100 per month for 6 years. Then in 2016, I received a letter saying my debt will be taken over by another debt collection company and I will receive further instructions from them.
Then two years later (earlier this year), I receive correspondence from Capquest demanding £3699 or to make repayment options. They have agreed £50 a month which I have been paying since March this year.
After receiving some refunds from payday lenders I am now in a position where I can make a settlement offer. I owe about £3300- how much do you think would be a sensible offer?
I have £2200 but I don’t want to use all of that if I don’t have to.
Thanks
Sara (Debt Camel) says
I don’t think they will take a much lower offer because you are paying them £600 a year. Is this the best use of the refund? This CCJ may be annoying but the interest is frozen (I assume?). Do you have other debts which are more of a problem?
Dean says
Hi Sarah
No all my debts are now paid.. I left this one til last as the interest was frozen on this one.
Sara (Debt Camel) says
great! I guess I would probably offer £1800 – so three years payments. But it’s really hard to tell what they would take.
Dean says
Ok thanks.. I’ll give it a go..
Thanks Sarah, you and everyone on this site have been great help towards my new debt-free life. 6years of debt completed and paid by pay day refunds and high interest loan refunds. I can’t believe how much I paid in interest over the years.. my prediction was half of what I got paid in refunds..
Josie says
Hi Sara
I need some help about whether I can/should send out F&Fs.
I have currently debts of around 36K with Westcot, NatWest credit cards, PRA and Lloyd’s. These debts have been defaulted and is now with debt agencies.
Wescot (Halifax) £19000k
PRA (MBNA) £8K
Wescot (natwest) £3800
Natwest credit cards £1200
Lloyd’s £900
I have been on a DMP with stepchange since May 2017, and am currently paying 550pm.
I am struggling to pay this 550 a month and am worried that if I reduce this payment I will be harassed.
I didn’t realise that you can request for F&Fs and I think I should be able to get some money from friends and family around £5k if I can write of some of my large debts. I wanted some advice if I can request F&Fs and if so then do I request with all or some? Who should I contact first/what amount should I propose?
What information should I supply them when requesting and f&F.
Your advice would be greatly appreciated.
Sara (Debt Camel) says
If you are struggling to pay the 550, talk to StepChange. If that is reduced it makes any F&f offer stronger.
But at the moment you are paying over 6k a year to your creditors. They are not likely to accept 5k to settle your debts!
How old are the debts? When were the accounts opened and when did you default?
Josie says
Hiya
Thanks for your response. I have had these these accounts for at least 4/5years and been missing payments since Jan 2016, went through step change in May 2017 and my accounts defaulted earlier this year around Jan/Feb.
Can I not approach some of the credititors not all with a F&F?
At what point can I start to ask for F&Fs, what is the criteria?
Sara (Debt Camel) says
You can approach some of the creditors and make an offer. But as I said, if you are struggling with the £550 a month your first step should be to talk to StepChange and get this reduced – if it is cut, it makes it more likely that any offer will be accepted. And if you do settle one debt, StepChange will expect you to carry on with the same monthly payment so your other creditors will get paid more.
there is no specific “past this point you can ask for a F&F”. You have to make out a case as to why your situation is not going to change. So this could be early on if you had a bad health condition and were on benefits and only making a low monthly payment. But you are presumably in work and you are making large monthly payments, so the creditors may just decide to wait as they are getting a good amount from every year at the moment.
Dan says
Hi Sara,
Posted on another page but feels more appropriate on this one. Just had a full and final (partial) accepted my MBNA, they said they will not send paperwork to confirm this agreement until payment is made, but the agreement exists? Is this correct. They also mentioned that the debt could be sold at any moment and the offer is valid for a short period of time.
Is this normal procuedure for defaulted debts and acceptance of settlement? Im worried they might mug me off and sell my debts of after our agreement
I made the payment this morning, they accepted 20% since i made no payment for 7 months and borrowed some money to pay if off. They said they will send a letter next week to mention the settlement
Sara (Debt Camel) says
It’s isn’t normal to refuse to put the settlement details in writing – I always prefer people to do that. But MBNA calls will have been recorded, so if you don’t get a letter in the next two weeks, send them a formal complaint in writing.
Dan says
I thought i did something stupid but the offer of settlement was too good to wait for and couldnt take risk of it being sold. I called them 4 times to reiterate theagreement and they said they will write off the outstanding amount and not sell or chase me for the remaining balance in addition mark it as partially settled on my credit file.
I made the payment and they will issue the letter on Monday. I also recorded one of the calls and they record them on their side too so my conversations and points would have been recorded. This stuff is stressful, its a dog eat dog world cant trust noone nowadays.
Sara (Debt Camel) says
I think you will be fine – I am not expecting any problems. Just make sure you get that letter and file it somehwere safe :) better safe than sorry.
Rolf says
Hi, a friend of mine has been paying a long term debt for over 15+ years. The original debt was approximatley £10000. Sometime ago the debt was consolidated to a debt company and has since been sold to another debt consolidation company. In a recent statement the total paid to date has been £12236 so far but apparently £8811 is still owed ! (which is a grand total of £21047 !). My friend is off long term with illness and is unable to work yet has still faithfully been paying £50 per month somehow despite her circumstances.
Having read this blog she is now writing to them for a copy of the CCA to see if the debt is still legal.
Is there any other advice you can offer please?
I hope you can help – she is finding this situation very upsetting.
Sara (Debt Camel) says
It sounds as though she can’t afford £50 a month. Is she renting or buying? Does she have other debts as well?
Dan says
Hi Sara,
Just an update, I got a letter from MBNA Confirmation of short settelment payment and below wording:
What happens when you proceed with a partial settlement?
We will:
· Register a partial settlement with the credit reference agencies for up to six years,
which may affect your ability to obtain credit in the future.
· MBNA as well as any other third party will take no further action to recover the remaining balance.
· Close your account
Is this sufficient wording that it will never be pursued again?
Thanks,
Sara (Debt Camel) says
Yes that sounds fine. Keep that letter.
Dan says
Good morning Sara,
Have received a letter from MBNA with Short Settlement letter heading and below text:
“What happens when you proceed with a partial settlement?
We will:
· Register a partial settlement with the credit reference agencies for up to six years, which may affect your ability to obtain credit in the future.
· MBNA as well as any other third party will take no further action to recover the remaining balance.
· Close your account.”
Is this good enough or do you need the words FULL AND FINAL or FINAL in it?
Thanks,
Dan says
This is in addition to the conversation above on 15/12/2018
Thanks,
Sedu M says
HI,
I used to have an overdraft with Natwest, when I graduated in 2010 I was all over the place, I had not fixed address, I moved from one friend to another. Now I have a life again and I want to sort it out but have told me to check with Experia and Equifax but I can’t find anything. I believe it has been ‘Statute Barred’. I’ve also checked for court orders, there is nothing.
If I wanted to clear this, how would I go about doing this?
Sara (Debt Camel) says
It’s hard to be certain when an overdraft has become statute barred, see https://debtcamel.co.uk/statute-barred-debt/. But if this debt is not showing on any of the three credit reference agencies (NB also check your Noddle report as that looks at the 3rd CRA, Call Credit) that is a good sign that it was marked in default more than 6 years ago. If that is the case, and if you haven’t paid anything to the account since, then you can pretty safely assume that it is statute barred.
If it is statute barred, the creditor has left it too long to go to court. This isn’t you trying to wriggle out of paying a debt, it’s just realistic. You can’t be expected to keep records and paperwork forever.
So I suggest you check Noddle now. And then if you have a lump sum to pay this off with, move it into a special savings account that you won’t use. Just let it sit there. If a creditor gets in touch with you, then the money is there.
N Holding says
I was made bankrupt in 2014 and left an outstanding overdraft of £3500 with a joint TSB account in mine and the wife’s name.
As we are aware the debt has transferred to the wife and appears on her credit files as a defaulted credit account with a settled date but no default date. Interestingly it looks as if some additional charges were added about six months ago which have pushed the overdraft over its limit and attracted the default symbols on the credit report.
We have never had any correspondence from TSB since the date of bankruptcy.
Finances have now improved since bankruptcy and we are looking to gradually clean our credit files with a view to remortgage.
I’m wondering the best way to approach this. Is it worth offering a full and final settlement to draw a definite line under the debt? Will this debt still fall off the credit file given a settlement date is recorded?
I am nervous to contact them yet without a clear strategy in case they look to enforce the debt immediately.
Sara (Debt Camel) says
I don’t understand how this can have a settlement date but still a balance owing? What is the settlement date?
I think offering a f&f is probably a good move. But it would be good to get a default date added back in 2014 so it will drop off in 2020.
Carl says
I started a DMP in June 2017 with a hefty £68k of debt across 8 creditors. I pay £770 each month to my DMP and the balance is now down to £54k. I have 6 years to go until it’s clear. All my debts bar one have defaulted ranging 14-6 months ago. However, I am keen to move home soon as we have outgrown our house. I have a mortgage with 100k equity and have also now received a 12k inheritance. I do not wish to come off the property ladder to clear debt and rent. What is the best plan of action to reach our goal of moving home? I’m aware the defaults are there for some time now, but hope the equity I have may go some way to reducing risk with mortgage providers if for example I’m only applying for a mortgage with a LTV of 70%. Should I consider using the 12k to get settlement offers? Will mortgage providers be hugely bothered if a debt is settled or not as I will still have a £770 payment each month to pay towards a DMP and defaults. I believe the DMP payment along with an increased mortgage payment would be affordable to myself when it comes to affordability checks. My plan before the inheritance was to get the debt down to about 35k, which would mean having defaults on record over 2-3 years old (more attractive to mortgage providers as older defaults), at which point look to remortgage to release equity to settle rest of debts and then move 6 months later. Maybe now I can reach that figure quicker but my defaults will be fairly new on my record.
Sara (Debt Camel) says
Some questions that may sound irrelevant but bear with me…
– The one debt that hasn’t defaulted, who is the creditor and how large is it
– How much is your current house worth and how large is the mortgage
– Who is your DMP with
– Do you have a partner, do they have debts, is the house in joint names
Sara (Debt Camel) says
It’s hard to say much about your options without more information, but:
– it’s unlikely that many of your creditors will accept a low settlement offer. Your DMP hasn’t been going long, you have a house with a lot of equity and you are making reasonable payments to your debts each month. You may be able to clear 15-20k of debt with 12k. That will take off a couple of years from your DMP.
– it looks as though all the interest is frozen on your debts.
– you may want to try to get a default added for the one debt where there isn’t one. This sounds wrong, but read https://debtcamel.co.uk/debt-default-date/ and see what you think.
– you won’t get a mortgage at a reasonable rate from a new lender with unpaid defaults on your credit record.
– your current lender may not want to lend you any more money.
– you need to talk to a good mortgage broker.
J says
Hi Sara – I have a DMP with approx £9.5k left of an original £24k. I’ve taken a look at my credit file and have seen the following. The only default I can see is for a payday loan with Lending stream that is due to finish next month – default date was Feb 2013. I have an arrangement to pay registered on the account with another payday lender MYJAR that says report until 6 years after account closure (I assume that means it will show until the debt is fully settled?). The query with this one is that I make payments to Credit Resource Solutions (its was previously with PRA group and Mackenzie Hall – so should there be a default on that account if it has been sold off a couple of times?
The majority of the DMP is for a couple of Barclays loans and they don’t show on my report at all – im guessing because they are over 6 years old and presumably would have defaulted previously (both loans now with PRA group – one with £7.5k left to pay and the other £800.
Those 2 debts represent 90% of whats left on my DMP.
Thanks in advance.
j says
My questions are – with the MYJAR debt, where do I stand with the lack of a default showing.
As for the DMP itself – is it worth asking for a settlement figure (should I check first with PRA that a CCA exists or not).
I will be in a position to pay off the DMP in full in the next few months – but is there any advantage in doing so if I have the MYJAR Arrangement to pay showing for the next 6 years i.e if I get a settlement figure for the DMP and it shows settlement not settled I presume this lasts for 6 years as well?
Sara (Debt Camel) says
I suggest you ask Myjar to add a default date for the debt, see https://debtcamel.co.uk/debt-default-date/. This will then be copied by whoever currently owns the debt.
Re: paying the debts in full. You may want to consider asking PRA to produce the CCA agreements for the debts first, see https://debtcamel.co.uk/settlements-old-debts-cca/
Frankie says
Hi Sara, I was wondering if you could help me? I’m currently in a DMP with PayPlan that I’m paying £152 a month for a £14000 debt. I was previously with StepChange but they weren’t managing the plan well so I changed.
The debt I accrued happened before I was aware of my diagnosis of bipolar, it also continued to get worse while I was seeking treatment due to impulse buying some pretty weird stuff. Due to my illness I’ve had several missed payments while with StepChange due to being signed off work and therefore less income.
My parents have agreed to come to my rescue (yet again) in around 6 months time, able to pay around £5000 if the companies are willing to accept, this is money from inheritance. I’ve calculated this would be around 40% of the debt, maybe slightly more when taking into account my £152 a month.
I was wondering if something like this offer would likely be accepted? I’m aware it’s a tricky question to answer but considering my patchy payment history and ongoing medical issues I wasn’t sure if this would make things more or less likely.
Thanks in advance, this website is incredibly helpful. Just to note I’ve claimed against all of the lenders I could and have already used this towards my debt.
Sara (Debt Camel) says
Hi Frankie – nice parents!
Can you say how old the accounts are, how long ago you defaulted and whether they have all been sold to debt collectors?
Frankie says
Yes very lucky indeed! A couple of years old, all but one (HSBC £5k) are now with debt collection agencies, I also think maybe one small payday loan too but not fussed about that one.
My last default would have been about 3 months ago and it lasted a few payments, I normally default once every 3 months or so due to sickness.
Sara (Debt Camel) says
Did you really open all the accounts only a couple of years ago? That is very recent to have opened the account, then got into difficulty; with them, then had a DMP from StepChange then switched to Payplan?
Sorry but I am asking as it may make a difference to your options and how prepared the creditors are to settle.
So when were the accounts opened? And how many of them have a Default Date (not a missed payment) on your credit record and what are those dates?
Frankie says
Hi Sara, yes the majority of these new accounts were open in early 2017. The default notices occurred in early 2018 which was the time I started with StepChange. I was very ill at the time, in and out of hospital following kidney failure caused by a failed suicide attempt which probably accelerated things more than normal.
I changed to Payplan very recently as I had to reduce my payments temporarily while off sick, due to my employer no longer paying sick pay, StepChange agreed this was fine and then cancelled my plan repeatedly, they always set it back up and apologised but following the circumstances I wasn’t happy to continue with the difficult communication and failed agreed arrangements as I struggle with communication as it is.
I’ve had a DMP before this one but after finishing it I fell back into a spiral of ill health and I’m actually worse off than I was previously. If I’m honest I’m not actually sure if I’ll be alive to finish my current plan off but for the sake of my parents this settlement would help a lot.
Sara (Debt Camel) says
I am sorry to hear of your problems and hope you don’t mind that you have had to set them out but it does help to see the full picture of your situation. If the accounts had been opened a long while, they may have been other options but I can rule those out.
This would normally be quite soon to be getting a F&F of only 40% accepted but if you can set out the offer from your parents (get them to write you a letter saying they are worried about your current health and can let you have £5000 if this will enable you to get partial settlements on all of your debts), details of your past history (including the failed suicide attempt, bipolar diagnosis and the number of times health problems have caused you to lose income over the past few years) and that you have no assets (I have been assuming you don’t have a house with equity?) then I hope your creditors will agree. Write the letters yourself, don’t go through Payplan. Start the letters by saying that because of your mental health problems you would like this to be considered by their Vulnerable Customers team.
It wouldn’t matter if a couple of small creditors rejected the offer, but unless almost all your debt will be settled by this offer, I think you should seriously consider bankruptcy. It’s not good for someone with physical and mental health issues to be stuck in a very prolonged DMP. Your parents’ money could pay for your bankruptcy fees and help you with a large deposit if you need to move house. having bankruptcy on your credit record can even be seen as a plus point in an odd sort of way when you are bipolar as it will make it very hard to get credit for the next 6 years, which isn’t such a bad thing for you…
Louis says
I received a letter from Intrum about an old debt, a credit card that I stopped using, paying since 2013.
They wrote:
“….and would like to offer you a discount by way of partial settlement on your account. We beytgis will help you repay your debts whilst saving you money.”
And then they offer a 90% discount if I pay end of February, or a discount of 30% if paid by end of March and 10% if paid by end of April.
And there’s this paragraph:
“You should be aware that the period for recovering your debt by court action has expired, so we will not be issuing Court proceedings to enforce payment. However, your debt still exists and legally we are within our rights to continue to ask you for payment.”
What does all this mean? If I do agree to pay by end of this month with the 90% discount offered does that mean that the debt is settled and it won’t show on my credit file (which is poor at the moment due to other reasons, but this debt is not showing) or would it show as partially settled and make my credit rating even worse?
If there’s a chance that by paying it will improve it I might have to ask family to help me towards the payment.
I haven’t been in touch with Intrum or the original debtor and haven’t made any payments since 2012-2013.
I’ve been trying very hard to improve my credit rating and two months ago I settled an old bill ( I started divorce couple of years ago and I just finally I’m back on my feet and charge of my finances)
Sara (Debt Camel) says
“What does all this mean?”
It means that the debt collector accepts they have no left this for so long that they cannot take you to court. It is “statute barred”, see https://debtcamel.co.uk/statute-barred-debt/. They can send you the odd letter about it – say once a year – but they can’t pester you. I suggest you keep this letter safe somewhere!
Because of this, you don’t have to do anything at all! There is no reason for you to pay them any money at all. You should certainly not ask any of your family for money to help deal with this.
Paying this debt or not paying it will have no effect your credit rating as the debt isn’t on there.
(You might want to check the debt really isn’t on all 3 credit reference agencies, see https://debtcamel.co.uk/best-way-to-check-credit-score/ for how to do this for free. As it is so old it is very likely to have dropped off, I am just suggesting being extra careful and double checking.)
Kate says
Hi
My husband used to be terrible with finance, having left home young and having no support he ran up debts.
He defaulted on all these over 10/11 years ago, and I got him signed upto at first Debt Release and then Step Change to manage his debts. Slowly we have been paying his debts off, but as he’s only had low paid jobs there’s still a large (to us) sum outstanding.
His debt with Halifax is around £6800, it’s now been bought by Wescot.
He has a debt of around £1800 with HSBC.
We know they both have records of the debt, through applying for CAA’s.
My husband’s current contract is up in July, we have one child already and are now expecting another in September. My mum has offered to lend us upto £2000 to try and clear the debt – she can’t help with childcare very much now, which means my husband may have to take part time work after this contract.
Do you think if we offer both debts 20% (then rounded up) they would take it? I’m hopeful as the debts are so old and the amount he’s paying off, Step Change have calculated it will take 20+ years to pay off. Is it worth starting lower and working up to this, as it’s the absolute maximum my mum could offer.
Thanks
Sara (Debt Camel) says
Have you asked Wescot (not HSBC or Halifax) to supply the CCA agreements? Are you renting, private or social?, or do you have a mortgage?
Ken says
Hi Sara
I am in a DMP and most of my debts are approaching 6 years, just recently 3 of the main ones have been sold on to Moorcroft and Westcot.
I have a limited amount of money at the minute and I 2 was going to try and offer full and finals to them.
Should I be sending the offers to these companys now or the original lender? I think I read somewhere these company’s no longer buy the debt any more but just mange the recovery?
Best Regards
Ken
Cid says
Hello I have a DMP that has been going since February 2010 paying £150 per month. The debt was all credit card based nothing Secured – approx £27k in total. The debts have been passed from the original Companys to other debt agencies several times over the years. Even the DMP company has changed hands a few times – originally with DebtSure its finally now with Gregory Pennington. They have contacted me saying my Annual review is due shortly so ive been going through what paperwork i have. If my sums are correct based on paying the same £150 a month its going to take another 12 years to clear!, which is a bit rich given that i was told originally it would all be cleared in 15years!(on the phone so no written proof sadly) Ive worked out now that the outstanding debt figure is roughly £15k across all companies. Do you think i shjould mention the possibility of a F&F to the DMP company? I dont want to go down that route if it turns out they would want something ridiculous.
Sara (Debt Camel) says
Do you have some money for F&F settlements available?
Have all the debts disappeared from your credit record?
Can you afford to pay more each month to the DMP? (NB I am not suggesting this as an alternative to a F&F, just trying to get a picture of your situation.)
It is a shame you have been paying a commercial DMP companies fees all these years – your debt would be several thousand pounds less if you had gone to StepChange where all your money goes to your creditors, no fees to pay.
Cid says
Hi Sara
Just checked my credit record and there is nothing logged so it seems they have all disappeared off my record. Ive worked out that the debt compnaies are getting roughly 7% back each year of the outstanding debt. And as i said previosuly its going to be about 11-12 years before its all cleared. My partner has mentioned they would be willing to lend me around £2-3K to clear them all and i pay them back. But thats only on the provision that all the debt is cleared so im not sure what to do.
Sara (Debt Camel) says
If you do make partial settlements the debts will NOT reappear on your credit record.
There isn’t a way to offer 2-3k to debts total 15k only if they all accept. This has to be done 1 by 1. (Well legally there is a way – it is called a single payment IVA, but the IVA fees would take up most of the 203k so your creditors wouldn’t accept it.)
So your options are
a) to try to deal with the debts one by one, accepting that if you sort half of them out, then the rest have to be repaid but it will be much faster!
b) just plod on with the DMP. As I said you would speed it up by a year or two switching to Stepachange who doesnt charge you fees
c) look at an IVA where you would make payments for 5 years (I am assuming you don’t own a house with equity?) and the rest is written off. Downside here is about 30% of IVAs fail…
Dealing with the debts one by one. So you could offer them 20% as a full & Final settlement. As the article above says. I wouldn’t do this through GP – write the letters to your creditors yourself.
Also read this https://debtcamel.co.uk/settlements-old-debts-cca/ as you may decide you want to do that before offering a F&F settlement.
Cid says
Sara
thanks for all the info will certainly have a good think about it. One thing i have discovered going through all the paperwork is that 3 of the 5 Creditor companies were using/had sold on to Idem Servicing. 2 of the debts that Idem were dealing with have now been passed onto Hoist Portfolio Holding Limited which when googled are showing as cancelled on the Interim Permission Consumer Credit Register. Not liking the sound of that.
Sara (Debt Camel) says
Just ignore that. Send the CCA request and then the F&F offer.
Mark says
Hi Sara, my wife received a default notice on her Lloydstsb credit card on 27/10/2017. She owes £5800. The debt was eventually passed to Wescot in June18. I find out about the debt in Oct ’18 and rang and spoke to Wescot and my wife gave them authority to deal with me directly. I mentioned my wife’s health/depression and said there were other issues, without even asking they said £4800 could clear the debt. The problem is my wife has addiction issues which she is trying to get over but at them moment and for the foreseeable future cannot control her finances and earns very little. I am willing to negotiate a F&F offer starting at 30%, at a push she may be able to make £50/month payment so 30% is roughly 3 years of payments..
my question to you is are they likely to accept my offer considering the amount of time that has passed etc? And should I be sharing the fact she has addiction issues?(not something we openly share – I simply mentioned health issues) lastly should I send a CCA request? Thanks in advance, you blog is very helpful.
Sara (Debt Camel) says
Westcot are presumably collecting on behalf of Lloyds, it hasn’t been sold to them? If that is the case, there is no point in asking for a CCA.
This is quite a recent debt, they are unlikely to accept 30% at the moment. I suggest you do share her addiction issue and see if you can get a letter from her doctor supporting this. Also ask for her case to be handled by a vulnerable customer team. £50 sounds like a lot if she isn’t earning much – you are not obliged to pay her debts? I would try to get a lower offer agreed and then come up with F&F after 6 months or so.
Mark says
Hi Sara, thanks for the quick reply. Yes Westco are acting on behalf of Lloyds, so I understand your point re CCA. I totally accept I’m not responsible for my wife’s debts, She is on the long road to recovery and I just want to help! I’ll ring Wescot and ask for her case to be handled by a vunerable customer team and try and agree a lower offer and speak to the GP. Thanks again.
Jake says
Hi Sara, you have given me advice in the past but I cannot find the posts on here any more. Anyway, I am about to send out F&F offer to 9 creditors currently totalling £53.5k which have been on a DMP since summer 2009 paying £100 per month. As per our previous posts I am going to offer each creditor 30% settlement of the outstanding balance. To do this, my wife is giving me £16k, however, when contacting some of the creditors (to confirm outstanding balances, account numbers and where to send the offer to etc) two of them asked is the £16k a gift or loan?
In my letter template from the link on this site I have stated it as a gift but I wonder if it’s better to state it’s a long term loan? My reasoning is that some creditors may believe that if they refuse my offer but most of the other creditors accept, then I will then have a monthly excess left from not having to pay the cleared creditors on the DMP. Therefore, I can then pay more of the £100 per month to them.
I hope this all makes sense; in short. Should I state it’s a gift or a loan?
Many thanks,
Sara (Debt Camel) says
It is best to say that you have been offered the money as a gift if it will enable you to settle your debts. In other words, you won’t get it if settlement offers are not agreed.
Jake says
That makes perfect sense, thanks Sara
Penny says
Hi Sarah
I am in a dmp with payplan total debts £52,000. I pay 74.00 a month . I will be pushing up daisies before it’s all paid back .
I received a settlement offer of one debt for £600 to settle £2,500. My mum said she would pay it for me . Can I do this ? All my debts are at least 10 years old and are over 10 debtors . On my credit file there are not debts listed and my credit score with clear score if 528. I am wondering long term what I can do to clear this debt . I have just had major surgery and suffering from anxiety and depression. This debt stresses me out and I would like a new strategy to deal with them . Any advice would be highly appreciated. My mum will be able to gift me £5k but I know that is not enough for F and F . Is it worth offering anyway percentage wise ? If any accept would I be allowed to pay them off ? If the debt was smaller then it might make me less anxious. I have property ( share owner ship) so no real equity available. I do have a excellent pension but can’t access that till 65. Sorry to ramble . Penny x
Sara (Debt Camel) says
A £600 offer for a £2500 debt doesn’t sound very generous.
Read https://debtcamel.co.uk/settlements-old-debts-cca/. I’m not saying this is an easy route, and you may feel it’s stressful and you don’t want to do it. But if you could get several of the debts marked as “unenforceable” then all your mum’s £5k could them be used to make better offers to the other debts.
Greg says
Hi
I have two unsecured loans outstanding from 2009
One for £10000 and one for £500
Both have token payments of £1.00 and both have been sold to agencies.
I am thinking of getting a mortgage after securing a permanent job.
What do you think would be a reasonable offer for a F&F payment?
Thanks
Greg
Sara (Debt Camel) says
Those are pretty old loans. I would think about it askingbfor a CCA agreement before deciding what to offer, see https://debtcamel.co.uk/settlements-old-debts-cca/
Doug says
Im in a DMP with Stepchange and have roughly 8.5K left to go. Majority of debt is with one creditor – PRA group, so I did a CCA and have been told the debt is unenforceable – with the caveat you still owe the money but we can’t take you to court etc.
So my intention is to pay off the smaller debts – can’t be fussed to CCA them as the debts are relatively small in comparison and would rather just pay them off in full.
With that in mind – and assuming I stop paying PRA (and effectively end my DMP), how do you think PRA will react? Would you expect them to offer me a full and final settlement, or sell the debt on?
I had thought about making the offer myself – say 10%, but if I just stop paying will it force their hand? Id rather have a full and final figure to be honest – just so I wont get any future hassle.
Sara (Debt Camel) says
Why not offer PRA 5% now? Say you are telling StepChange to stop making any payments to them but you are prepared to offer £x in full & final settlement.
You could always offer the other DMP debts 50% – many will go for that!
Doug says
Thanks for the advice Sara – do you think that PRA would accept such a low offer?
Doug says
Also as the PRA debt has already dropped off my Credit File is it worth mentioning this in my offer letter – as surely this is in my favor as they will say that they will mark my file as partially settled etc, but even if they do it wont show on my credit file (is that correct?)
Thanks again
Sara (Debt Camel) says
Say if they don’t accept it, you will stop paying anything. The fact it has dropped off isn’t really relevant to whether they will accept your offer or not. But no, it won’t suddenly reappear on your credit record.
Gareth says
Hey
I have been on a DMP since 2012 and owe 14k in total on 7 accounts. I managed to get some of the accounts to default in 2012 so 4 of the defaults have now dropped off. I have 2 accounts with Lowell (around 5k in total) who refuse to apply a default (ongoing dispute with ombudsman) and another default which will drop off next year. I’m hoping to pay all this off early as I have a freelance contract until October with an increased salary. My question is – would it be better for me to pay off Lowell in full (and not have a partially paid note on my record) and then make lower offers to the other creditors? My logic being the other creditors have since dropped off my file and so a note of a lower settlement wouldn’t appear on my record and because the default has disappeared they might be more willing to take a lower amount? I’m hoping to get all this settled at 8k. Any info is much appreciated
Sara (Debt Camel) says
What sort of debts are these? How long ago were the accounts opened, not when you defaulted?
gareth says
Hey Sara
They are mainly ex credit card/catalogue/loans which were taken out between 2005-2009 and have since been sold on
to other debt companies (around 2013-15)
Sara (Debt Camel) says
I suggest you read https://debtcamel.co.uk/settlements-old-debts-cca/. For credit card/catalogue/loans of that age is is pretty likely that at least some of them cannot produce the CCA agreement for the debt. If that is the case, then you can simply stop paying or offer a low amount as a full & final settlement, say 5%.
That will take a couple of months to establish for all of the debts – a few may be quicker. Meanwhile your FOS complaint against lowell proceeds to get deafult dates added.
Having a partially paid settlement does show on your credit record but doesn’t affect your headline credit score. I suggest you postpose thinking about this issue for a few months – after you have found out about the CCA agreements and you have the FOS decision, things will be a lot clearer to make that decision.
Gareth says
Oh wow I did not know this. I have a deep hatred of Lowell and nothing would please me more than then not finding that agreement. Will definitely pursue!
Benjamin says
Hi Sara
I am currently in a DMP and have been for approximately 10 years. A balance of over £60000 is now down to approximately £14k with about 2 years remaining with current payments of £530 per month. I own a home and have been given the opportunity to sell to a family member, for which I’d receive approximately 19k after clearing my mortgage. I had hoped to make an offer of about 50-60% in full and final settlement, leaving me with around £10k as a base deposit for a new house, rent for a bit and use the money I was putting in the dmp to build up the deposit and hopefully buy again in a few months. Firstly, as I have been a good dmp payer, never missed a payment and have increased my payments year on year, could this affect the likelihood of the f&f being accepted as they are getting a good bit of money from me without issue? Secondly if I tell them I’m getting the money from a house sale could they go down a CCJ route if they consider there’s equity in the house?
Thanks in advance for any response
:)
Sara (Debt Camel) says
With only two years to go, I suspect many of your creditors may not want to accept 50-60%. Because they will get the full amount back if they wait a couple of years.
One thing you consider is to ask all the creditors where the original debt was a credit card, catalogue or loan, to produce the CCA agreement for the debt. If they can’t (and after 10 years there may well be some who can’t) then the debt is unenforceable and you can simply stop paying it. Or offer a very low 5% if you prefer. See https://debtcamel.co.uk/settlements-old-debts-cca/ which looks at how to do this.
Have all these debts dropped off your credit record?
Benjamin says
Hi Sara, wow thanks for the quick response! 3 of the 8 debts are still with Barclays but are all overdrafts and only account for about 1k of the total. The rest are all with DCAs (Cabot, Moorcroft, PRA, Paragon and Westcot) the earliest being sold in 2012 and the latest 2016. One of the debts appears to have been sold on about 4 or 5 times. The account with Cabot accounts for half the remaining debt, with 7k left from a 25k consolidation loan taken out in 2007 with Northern Rock (oh how foolish and optimistic was I that this would work!). The account was sold to Cabot in 2013. Is it really possible that such a large debt could have been sold on without all the correct paperwork?!
I’m registered with both ClearScore and Noddle, both show all the same info and neither show any record of any of the original debts or anything other than my mortgage, phone contract and current account.
I’m curious as to why the CCA’s no longer exist? Is this just bad management or was the relevance and importance of production of the CCA not apparent until much recently?
Thanks again!
Sara (Debt Camel) says
This isn’t something new. It will depend on the terms the debt was sold – all the contract information may not have been part of that and the debt collector may not have the right to go back and ask the lender to produce it.
This is why you are asking the debt collector for this information, not the lender.
Remember the debt collector may have only paid a penny in the pound when they bought the debt. The original lender doesn’t want to be pestered after getting so little to retrieve ancient documents.
Benjamin says
Is there any merit in contacting the DCAs requesting what they would consider as a full and final offer and making a counter offer or accepting it if it’s reasonable? Obviously I’d be mentioning that a relative may be able to offer me a lump sum as suggested in other posts.
I’m so worried that now I’m near the end of the DMP relatively speaking, that if I start going down the unenforceable CCA route and one or more can locate it, they go down the CCJ route and the previous 10 years struggle would have been in vain.
Sara (Debt Camel) says
I doubt it. You see you have paid well so far, you have a house with equity and they are only 2 years away from getting 100%. They may take 80 or 90% but put yourself in their shoes – why would you accept less?
If a creditor can locate the CCA they are unlikely to rush and get a CCJ. if you are still paying them.
If some can’t locate the CCA you may be able to pay the ones who can in full.
You don’t have to ask for the CCA, it’s up to you. I’m just saying there is not much chance of getting all your creditoes to accept a 50% settlement as the end of the DMP is so close. So if you want to reduce the amount you pay in settlement, asking for the CCA looks like a better chance.
But there is no certainly here. You may get lucky and some may accept 50%. Others may refuse. Of course the ones who accept 50% may be the ones who know they cant find the CCA…
Benjamin says
Thanks Sara. Your advice has been invaluable. I think I’ll wait until the sale has gone through then go down the CCA route. If worst comes to the worst and they all demand payment in full then I should still be able to pay it.
One more question (I promise). Now the original debts have all dropped off my credit file, will these still affect my chances of getting a mortgage almost straight after the DMP is finished, either from paying it off in full, finding some are non enforceable, or from partial settlements accepted (or indeed a mixture of all 3)?
Sara (Debt Camel) says
“I think I’ll wait until the sale has gone through then go down the CCA route. If worst comes to the worst and they all demand payment in full then I should still be able to pay it.” that sounds like a plan.
“will these still affect my chances of getting a mortgage almost straight after the DMP is finished” yes because the DMP payments will be showing on your bank statements. But if you are renting for 6 months then a future mortgage lender will not know … just make sure you don’t apply for a mortgage to a lender which is part of the same group as a lender your had a DMP debt to. eg cross off halifax if you had a lloyds loan in your DMP
Aida says
Hi, is there a full and final template letter for secured loans. Condition being that the charge is removed from land registry deeds. Please?
Sara (Debt Camel) says
No. Just write out what you are offering and what you want done.
Doug says
Hi Sara,
After writing to PRA with an offer to pay 5% of an 8k debt they wrote back and refused and stated they wont accept anything less than what looks like 90%.
As they have already replied to my CCA request and also stated in the offer reply letter that the debt is unenforceable – do I ignore their letter or acknowledge it ? My immediate reaction is just to ignore it and wait for them to write back accepting my original offer – thoughts?
Im no longer making payments to them and my DMP will end this month.
Also assume that they decide to sell the debt to another collector – if they contact me can I insist they only contact me by letter – i.e not get hassled by phone calls?
Thanks again
Sara (Debt Camel) says
Stopping paying and not bothering to engage in a conversation that isn’t getting you anywhere seems sensible.
In practice you are not likely to be hassled by phone. If you are, write and ask for all communications to be in writing, put in a formal complaint if they do not agree and take the complaint to the Financial Ombudsman if it is rejected. But I very much doubt you will have any problems with this.
Karen says
Hi Sara
I have a DMP plan with a charity (10 years) which I am now going to be self managing soon. I have 4 creditors, all which are around 10 years old (3 are with DCAs) I have written to all 4 requesting CCAs, 2 have replied so far saying they are not enforceable. I would like to offer F&F settlements to try and get these cleared up.
Should I write to the 2 that have responded about the CCA offering a low F&F or should I wait for a bit, should I write to them informing them that I will not be making any payments until a CCA is produced? Sorry for the many questions just not sure what my next step should be?
In relation to the 2 that I haven’t heard from yet, should I still write offering a F&F even if I haven’t heard from them after the 12 days is up?
Thank you in advance
Sara (Debt Camel) says
I suggest you tell the two that have said they can’t produce the CCA that you won’t be making any payments.
No point in contacting the other two now – you have to give them a couple of months. Then when you have heard from the other two and you know where you stand, you can decide whether you want to offer F&Fs and how much.
Karen says
Thank you. In relation to the other two that have not yet replied, do I cease making payments until I have heard from them?
Thank you
Sara (Debt Camel) says
It’s up to you. I probably wouldn’t.
Karen says
Ok if I don’t hear from them after the 12 days I will send a follow up letter. Thank you for your advice
Jess says
Hi Sarah,
I have been struggling with debt for the past 3 or so years, and have been unable to make any payments to my creditors for around 8 months now. Yesterday I began setting up token payments to some of the creditors (between £1 and £5), but am unable to pay more than this to any of them, and have no likelihood of being able to increase payments in the future either.
I have no assets (bar my car which I have up for sale to pay my debts – worth around £1500), my expendable income I have each month is around £19, now going to go towards token payments to my creditors, but I have been offered by a family member £5000 if it can get me out of the situation I’m currently in.
I have approached my creditors (11 creditors) with a pro-rata offer of £7000 split amongst them all as a full and final settlement offer (£5000 from family member, £1500 from my car, and hoping to be able to scrape together another £500) for my debts totalling currently £25,082 which I think is about 27% of my debts. I have enclosed, along with the offer, my income and expenditure sheet, and a spreadsheet showing how the offers were worked out, including the offers made to the other creditors.
My question is, how likely do you feel my chances are of having my settlement offers accepted based upon my current circumstances?
Thanks for any and all advice given, it’s much appreciated :)
Sara (Debt Camel) says
This sounds rather early to have 27% offers accepted. See this recent post where I looked at one person’s situation in detail: https://debtcamel.co.uk/too-soon-settlement-offer/
I think you may either have to sit back and make token offers for another year or two or – if you are desperate to get this resolved sooner -look at the alternative of bankruptcy, as you have no assets to protect. See https://debtcamel.co.uk/debt-options/bankruptcy/ which looks at the most common questions people have about bankruptcy.
In bankruptcy from what you have said you probably wouldn’t have to make any monthly payments. If you needed to move house and had problems finding some where to rent, your family member could help by acting as a guarantor.
Jess says
Thanks Sara,
I tried to explain why I’m trying to avoid bankruptcy in my first message, but it was too long, so here goes:-
I had, up until very recently, been planning to go down the bankruptcy route, but an opportunity to potentially become a director in one of the companies I work for has occurred (this is still up in the air, and may not happen at all) which could happen within the next couple of years, and so I don’t want to squash that possible opportunity unless I really have no other option available to me. This opportunity, I ought to point out, is unlikely to give me a larger expendable income for at least 4/5 years, so no real prospect of repaying my debts within a reasonable time frame.
I know it’s unlikely they’ll come back straight away and agree an offer, but I have nothing else to offer, I could not go up with my offer, and I’m hoping I can press upon them that if no agreement is reached that I will have no option but to go bankrupt and they will only then have access to the £1,500 for my car (less the cost of filing for bankruptcy)…
Have you heard of companies caving in this type of circumstance? Like you say, if I have to I will continue paying token amounts until they’re more likely to agree to an offer. If any of them agree to it, is it worth paying those companies off and continuing with token payments to the rest, or holding out for all?
Thanks, Jess.
Sara (Debt Camel) says
“Have you heard of companies caving in this type of circumstance?” Well it’s not impossible – but with 11 creditors I would have thought it’s very unlikely many of them will. You have made the offers, you may as well wait and see what they come back with.
But if you get mostly rejections, is it worth putting your debts on hold because of some chance of becoming a company director that won’t actually benefit you financially? You can become a company director when you are discharged from bankruptcy after 12 months.
Mathew says
Hi Sara,
I have total debts of £17,000. I’m currently with Step change and paying 6 creditors (mainly debt collection) £177 a month. If i continue payments debts will be paid off in 2027. Debts are all defaulted and come off at the end of this year and mid 2020. My partner has agreed to get a loan to clear these so i’m out of the DMP. W ould be easier for us to get a mortgage in around 1 months time? I obviously want to pay as little as possible and offer a f&f. How will the part settlement affect my credit and does the f&f stay on the file forever. Would it be more beneficial to pay in full to get a better chance of a mortgage?
Sara (Debt Camel) says
Read https://debtcamel.co.uk/mortgage-recent-defaults/ and also https://debtcamel.co.uk/dmp-partial-settlement/.
Basically if you can settle the debts now and not apply for a mortgage before the end of the year, when they will have all dropped off your credit record, the DMP and the partial settlements won’t be visible (unless you apply for a mortgage to one of the lenders you have made a partial settlement with – so avoid them!) so it won’t make any difference they were partial settlements.
But if you apply for a mortgage next month, you are going to have problems if you settle the debts partially or in full as most mortgage lenders won’t be happy with a DMP that has only just ended.
Michelle says
Hi, I have been paying off old debts through DMP for the last 8 years. I recently got rid of a few debts by offering 30% F & F. I have one creditor left who said they can’t accept a settlement offer as that was the agreement they made when they bought the debt off the bank. This same creditor has said that the debt is statue barred and the default expired and the debt is off my credit file so they can’t legally chase me for the debt. They advised that this could change in the future and they could add notes to my credit file. It’s a large amount 13.5k and I just not sure whether I need to pay it? I’ve got rid off all my other debt, my credit rating is high and my file clear so I don’t want to cause trouble for myself, but it’s such a lot if money to repay if I don’t really need too
Sara (Debt Camel) says
“This same creditor has said that the debt is statue barred and the default expired and the debt is off my credit file so they can’t legally chase me for the debt. They advised that this could change in the future ”
They have put that in writing? In that case it can’t change in the future – once a debt is statute barred it is always statute barred. And a debt cannot reappear on your credit record when it defaulted more than 6 years before. Nor can a creditor “add notes to your credit file”. From what you say, you can forget this debt.
Marta says
Hi.
My husband went bankrupt in May 2017 for an original debt of just above 7000. The original debt got paid off a month later but the debt collector went after my husband for the additional administration expenses of the bankruptcy. My husband did not engage with the debt collector to the point that that those administration fees went up to 45000. Not having a job, a car or a personal bank account they went after our home that we jointly owned. My husband took his life in January just after he received an eviction note. I have found out about all this only a few days after his death. The debt collector suspended the eviction order and they reduced the debt of 25%. Now they are sending emails to check when I am able to sort out the debt. I managed to collect only half of the money. I am on my own with two children is there anyway I can negotiate the payment ?
Sara (Debt Camel) says
i am so sorry to hear about this. I suggest you go to your local Citizens Advice and ask for their help. It may be possible to challenge teh fees that have been added, but this needs a specialist to look at it. Your local citizens Advice can get help from the national Specialist Debt Advice Service.
May says
Hi Sara,
In 2014 I lost my business and found myself in £25k debt between 5 creditors. I have now got that debt down to 7.6k with one creditor (which was the only account that defaulted 2014) and have been paying £100 per month towards it for the last year (smaller amounts before that). This debt initially was 11k.
I’ve been paying this debt off dutifully since the default in 2014 and the agreement with the debt agency (which was always Moorecroft but recently was moved to another agency.. does this mean they’ve sold the debt on, is this an issue??)
Anyway, my expendable income is not going up, but I’m due a bonus from work in June (out of pure luck) which will be around £1.5k.
Do you think it’s better to wait and continue to pay indefinitely (I cannot afford to pay more than £100 per month & don’t see this changing unless to go down, to offer some financial relief) or attempt to offer this small amount as a F&F? In June I will owe £7,400, so I know this is only 20% of what is left and I just want to figure out the likelihood of them accepting this amount, given how much has been paid already / how long I have already been paying / how long it will take me to clear if I continue to pay the same amount.
Any insight would be greatly appreciated – thank you!
May
Sara (Debt Camel) says
you have cleared th debts with the other four creditors?
It sounds as though £100 a month is too high to be manageable – what do you think would be realistic? They are not likely to accept £1500 if you are paying them £100 a month…
the letter about the new debt collector should have said if the debt has been sold to them or is just being collected for the same creditor.
May says
Hi!
Yes all the other four creditors have been paid off, this is my last and only debt. I can just afford £100 a month, but it leaves me with nothing extra after the rest of my outgoings so I was wishfully thinking trying to pay it off would help. Would it be a better idea to reduce my payment to them (to say, £50 per month) and try again at the end of the year/next year with a bit more than £1500? Or should I just drop the idea and carry on paying what I can? I know the debt drops off my credit rating next year, but I would love to start saving a bit now and getting rid of this expense would really help!
Thanks for your help.
M
May says
Hi!
Yes all the other four creditors have been paid off, this is my last and only debt. I can just afford £100 a month, but it leaves me with nothing extra after the rest of my outgoings so I was wishfully thinking trying to pay it off would help. Would it be a better idea to reduce my payment to them (to say, £50 per month) and try again at the end of the year/next year with a bit more than £1500? Or should I just drop the idea and carry on paying what I can? I know the debt drops off my credit rating next year, but I would love to start saving a bit now and getting rid of this expense would really help!
Thanks for your help.
M
Steven says
Hi,
I have total outstanding debts of £51k with 3 creditors. TESCO now with INTRUM – £39700
BARCLAYCARD now with PRA GROUP – £6700
HITACHI CAPITAL -£5000
I am paying into a DMP with StepChange at £190 a month and have been since June 2017. Both INTRUM and PRA are debt collectors and those accounts defaulted in June 17. HITACHI CAPITAL refuse to default as I am on a reduced payment plan with StepChange.
I have a property worth approx £170-£175k with an outstanding mortgage of £130k.
I am after advice on 2 options.
1. Would I possibly be able to remortgage to offer a F&F IVA payment say £15-20k (subject to a mortgage provider giving me that option?)
2. I am looking into selling my property and moving in with my partner who rents. If I sold my property would I have to use all of the equity to pay off the debts or would I be able to make F&F offers of say between 40-60%, possibly lower?
At my current £190 a month payment plan I would be debt free in 2041.
Any advice would be much appreciated.
Thanks
Sara (Debt Camel) says
You do need to do something – that DMP is not a long term plan.
I would be very surprised if you can remortgage. To point out the obvious, with your current mortgage level you have run up 50k of unsecured debts, why would a mortgage lender think you are a good risk for a larger mortgage with only about 10% equity?
If you sell the property, it is up to you what you do with the money, you don’t have to use it to settle your debts, but that would be a good move obviously. After sales costs and moving etc it would seem you may be left with 30-35k?
Legally a lender may not be impressed with being offered too low an amount and may ask for details of the house sale. If they think you have a large amount of money sitting in the bank, they may reject an offer and may think about going for a CCJ.
Lau says
A house that I bought stupidly, at a young age with my ex was repossessed in 2012 after he did a runner (never saw him again!). I am now being chased for the £30k shortfall by someone who’s bought the debt (this started around 2 years ago). A debt charity advised I paid £1 token payments per month this time last year as I was a full time student and getting weekly letters through. I am now in full time employment & my family will possibly gift me a lump sum to try clear this, as in the next 5 years, I hope to be in a position to buy another house (as don’t think I could with this debt, although there’s nothing on any of my credit files showing the £30k debt but technically would still have to declare it). As it was a joint debt, do you think they’d accept a lower full & final settlement (I.e. £10k)? Could they then still chase my ex for the rest making them therefore more likely to accept this? Is it even worth trying for a settlement or should I just continue with minimal payments for years to come? If it’s not showing on any of my credit files, is it going to have any real effect upon me & therefore warrant offering £10k as a settlement?
Sara (Debt Camel) says
I will start of by saying something that won’t help you but may help other people reading this. It is a great pity that you did not go bankrupt years ago. This would now be ancient history and you would have no problem getting a mortgage at a reasonable rate.
You are very unlikely to be able to get a mortgage until this old debt is settled. It is normal to be asked about repossessions when you apply for a mortgage and the monthly payments are showing on your credit record.
The creditor may be prepared to accept a settlement offer if you say the money will come from a relative and produce an income & expenditure statement showing that you can only afford a very low amount each month. I wouldn’t complicate your offer by saying they can go after your ex – see what they come back with.
If they refuse, well honestly bankruptcy could still be a sensible option for you now. This millstone is not going to go away.
Lau says
I was studying in Australia at the time, so wanted to put it all to one side until I got back. Up until this point, I didn’t even realise I owed any money from the shortfall and maybe naively thought it had all just been wiped off, otherwise, I would have gone bankrupt at the time. But I was in my early 20’s deverstated by everything and suffering from terrible depression that. I also now work in a job that possibly could be affected by bankruptcy. I’ve also read that any income in excess of £20 a month will be taken from me for 3 years?
There’s nothing on my credit file, so I’m hoping to possibly rebuild my credit a bit. Everything has dropped off, including the old mortgage and there’s no details on there of this £30k debt. Hence why I don’t really want to go bankrupt, surely this will majorly set me back again for the next 6 years? I just really don’t want to declare myself bankrupt now, at this stage in my life and yes, completely deverstated that I didn’t do this years ago whilst I was a student. But hey ho, not a lot I can do now to turn back time. I received poor advice at the time and was very, very depressed and in a bad way.
Ray says
Hi Sara,
I have been in a DMP with Stepchange since 2012. I pay £400 per month (used to be £550) and to date I have paid back £35000.
I have £10500 left between 5 creditors. All the debts have been sold on, some more than once.
The last default recently came of my credit file as it has been 6 years.
My circumstances have recently changed and I cannot afford the monthly payment.
1) Do you think offering a full and final settlement is an option (I would sell my car).
Or will it be rejected due to all my payments been on time?
2) If this is accepted will it negatively affect my credit file?
Or are the debts definitely off the file as the original default has been more than 6 years?
I have just been accepted for a decent credit card and I am keen to rebuild my credit rating.
Thanks in advance for any help,
Ray
Sara (Debt Camel) says
A F&F is definitely an option. You can explain when you make it that your monthly repayment has to be reduced a lot.
F&Fs will not cause the debts to reappear on your credit record.
BUT before you make F&Fs, read https://debtcamel.co.uk/settlements-old-debts-cca/ which sounds like a similar situation to you. This is well worth a try.
Rob says
Hi Sara,
Just looking at the F&F template on National Debtline and wondered about the line “I can confirm that I am unable to pay the money which I owe in full.”
If you have already confirmed a debt is unenforceable through failure to produce a CCA, are you admitting to it by including this line?
Is there a F&F template specifically for an unenforceable scenario?
Thanks.
Rob
Sara (Debt Camel) says
Hi Rob, I think you are confusing two things.
If you are arguing a debt is statute barred, and so unenforceable, then it is important not to acknowledge the debt until the debt is statute barred as that resets the clock. (This doesn’t matter after the debt is statute barred, acknowledging it then can’t unbar it.)
But if a debt is unenforceable because they can’t produce the CCA, then you aren’t trying to deny the debt at all. It’s there, you owe it, but they can’t go to court.
In practice though you can just delete that sentence from the F&F offer if you want.
Dean says
Hi Sara, I have two accounts that are being collected by Link – One is Barclaycard and one is MBNA. I will soon be in the position to offer F&Fs but i’m guessing if i offered say 50% for the Barclaycard debt I would need to offer the same for the MBNA? or could I just offer on one?
Thanks Dean
Stuart says
Hi Sarah back in 1999 I went through a Divorce and the marital home was reprossed by the Halifax. As the house had negative equity after it was sold by the bank it left us with a debt of £20,000. The Halifax stated the debt would be split and we would both have to pay £10,000 each. My ex wife came to an agreement with the Halifax and made a full & Final payment of £2,500 leaving me with the remainder I.e. £17,500. Over the last 20 years I have managed to get the debt down to £10,500. The debt has been sold on to different companies about 6 times since then. My sister has offered to lend me £2,500. Do you think if I offered a full & final payment against the remaining debt they might except. I have never missed a payment in the 20 Years. I started paying a couple of quid a month as that’s all I could afford. I now pay £40 a month and have been doing this for the last 2 to 3 years. Any advice you could offer would be appreciated.
Sara (Debt Camel) says
I will start by saying what will not help you but may help anyone else just having their house repossessed. It is a huge pity you did not go bankrupt 20 years ago and get a clean start.
“The Halifax stated the debt would be split and we would both have to pay £10,000 each.” was this in writing? Why did you get left with £17500 not 10k when your wife settled her part.
Stuart Watson says
Hi Sarah I was told verbally not in writing. I have checked this with the Halifax and they stated I had to pay the outstanding balance. I have argued this but with no luck so I have been paying this for the last 20 years. I have asked my ex for a copy of the letter Halifax gave her after the F&F payment but she will not give it me.
Sara (Debt Camel) says
It is a shame you did not follow this up with a formal complaint all those years ago. I doubt that a complaint now would succeed.
I hope they will accept 2500 as a F&F settlement. You need to make the point that this money will be coming from your sister and is only available if they agree to settling the debt.
Stuart Watson says
Ok thanks for the help I might try asking my ex for the letter again as it’s been a few years and we are on better terms now.
Dean says
Hi Sara, I have two accounts that are being collected by Link – One is Barclaycard and one is MBNA. I will soon be in the position to offer F&Fs but i’m guessing if i offered say 50% for the Barclaycard debt I would need to offer the same for the MBNA? or could I just offer on one?
Thanks Dean
Sara (Debt Camel) says
Does link own the debts ar are they collecting on behalf of the MBNA / Barclaycard? How long ago did you default?
Dean says
Hi Sara, missed your response.
The Barclaycard one defaulted March 2013 so has dropped off my file, and the MBNA one drops off Feb 2020. I owe £3,421 combined, and I have paid approximately £12,500 since the start of my DMP. I am currently paying £168 per month towards these debts.
I assume Link have purchased these debts – the MBNA one is reported as Credit Card from Link Financial Mbna.
Sara (Debt Camel) says
In that case I suggest you read https://debtcamel.co.uk/settlements-old-debts-cca/ and ask for the CCAs before making an offer to the debts.
David says
Hi, great advice, thank you. Is it true the a debt buying company like Intrum can buy my Tesco Credit Card debt £5500 & when CCA section 78 request made produce a ‘like the original’ agreement with my details put into it & say that this is legally binding. I stopped token payments of £1.00 pm in July 2018, the debt was defaulted in 2011 & dropped off my credit report in 2017. Will it reappear on my report as a new debt & can Intrum start charging me interest? Worried.
Sara (Debt Camel) says
A creditor has to produce a “true copy” of the original agreement. See https://debtcamel.co.uk/ask-cca-agreement-for-debt/.
No, this debt can never reappear on your credit record. No Intrum cannot start charging interest.
Steve says
Hi Sara
I am in the process of Annulling my Bankruptcy from which I was discharged September 2018. I owe £26,000 to 6 companies 5 of which purchased the original debts these are Link x 3, Cobot, PRA and Westcot the last is to M&S. Can I make a full and final offer to “satisfy” these debts also is it to late for me to ask them to provide evidence of CCA agreements. This is further complicated as I am in dispute with the OR concerning an inheritance dating from August 2018. He has agreed that the disputed funds held by the probate solicitor can be used to annul my bankruptcy this would save me %15 OR fees however it would take most of my inheritance.
Regards Steve
Sara (Debt Camel) says
I assume you are applying to annul your bankruptcy on the grounds that your debts have been paid in full. So far as I know, that means in full… And I doubt that the CCA is relevant – a debt may be unenforceable in court if no CCA can be produced, but that doesn’t mean it legally ceases to exist.
Jane says
Hi Sara,
I’m with step change and have been on a dmp since 2012. I have been to given a few thousand by my mum and could probably offer 50% to three of my my creditors. This would reduce remaining debts quicker. My question is, will step change close my dmp when I tell them I’ve settled some of the debts? I’ve read that they dont like people doing this but means I’ll be debt free far quicker!
Paul O’Sullivan says
Hi Sara
I’ve been on a dmp since Oct 2017 I owe £5800
To various creditors my parents said they would give me £2500 to do a full and finial settlement.
What do you think the chance of that being accepted. I pay £123 per month to StepChange says debt free 2023.
Sara (Debt Camel) says
How many of the debts have been sold to debt collectors?
Heather says
Hi Sarah,
My wife and I have accessed our credit files, and between us on there we have £13k of debts, all defaulted and a few CCJs, all with debt collectors, some small ones from 2 years ago, some many years ago. We’ve been making token payments to a few of them, but mostly nothing. We could be given/loaned some money towards clearing them but nothing like the £13k, I’m thinking it may be about £5k. Am I right in thinking we have to pay the CCJs in full, then any remaining money we could make F&F offers?
Sara (Debt Camel) says
I think you need to look at each debt/CCJ individually. Also any that have dropped off your credit record where you have made any payments in the last 6 years.
It is possible to make a F&F offer to CCJs, whether they will be accepted depends on your circumstances.
If any of the debts are pretty old loans or credit cards, have been sold to a debt collector at least once and there is no CCJ, you could also look at asking for the CCA agreement for the debts, see https://debtcamel.co.uk/settlements-old-debts-cca/
Chas says
Hi Sara
I’m in a DMP and have 2 charging orders lodged against my property which were registered in July 2010 and Feb 2011. We’re looking to consolidate our debt so were enquiring about the likelihood of obtaining a F&F and them discharging the order? My initial phone calls have been met with a request for the full amount only. Are you aware of anyone in such circumstances reaching a reduced settlement? Both are with CABOT.
Sara (Debt Camel) says
is the house in negative equity?
How large are the debts in your DMP and how old is the DMP? how are you proposing to consolidate them as your credit record must be poor?
Chas says
Hi Sara
Thanks for responding. We have sufficient equity in our property and recently tried to sell it to settle the debts, however this fell through due to HS2. The DMP has been in place since 2013 and we’re in the process of consolidating as my wife’s credit rating is good/excellent.
Sara (Debt Camel) says
It is almost always a very bad idea to consolidate DMP debts where interest is frozen into a debt where you pay interest. Why would you do this? Also the DMP debts sound old … read https://debtcamel.co.uk/ask-cca-agreement-for-debt/ and see if some of them may be unenforceable so you could stop paying!
Danielle says
Hello.
I currently have a debt. The debt was originally with Barclays partner finance for a car finance.
Moorcrofr bought the debt.
I stopped paying for the car mid 2017 due to losing my job and then suffering depression.
My debt is for just over £6500 now.
In July 2018 we contacted and started paying £5 a month towards my debt. I stopped paying this again by mistake. And my anxiety was too much to call them. So in March 2019, we set it up again, doing an expenditure and being able to afford £5 a month. Once again this direct debit failed and I’m too worried to call them, so have not been paying anything.
I am currently still unemployed due to my depression. I receive £220 a month from Universal credit. I have to live from this too.
When we called them in March 2019, they was happy to accept £5 a month. With this in mind, it would take over 108 years to repay this debt.
My mother has offered to help me if we can get a low enough F&F. Do you think they will accept 20%? Which is around £1300. Thank you in advance for your help.
Sara (Debt Camel) says
Can I ask if you have any other debts?
Danielle says
I had one three years ago for a laptop but have had no contact with the company in the last three years. They haven’t got in touch with me and I haven’t them. That one was around 1k.
I had a phone contract default three years ago too, they tried charging me for four contracts when I’d only taken one out. I told them to take me to court and I believe it was dropped then.
I have £63 on my credit card which is only recent, and not yet a behind debt
Sara (Debt Camel) says
Can I suggest you should look at your credit records with all three credit reference agencies, see https://debtcamel.co.uk/best-way-to-check-credit-score/. You need to know how many of those other debts are showing, as it doesn’t seem safe to assume they have all gone away.
If your nice mum helps you settle this car debt, another one may just pop up. And then another one.
Danielle says
I have just looked on Equifax at my credit report.
It says my car balance is £8,919. However when I called them up previously when discussing the DMP, they told me that my settlement figure is around 6500. Is this due to there being no interest if paid in full?
My laptop debt is £851 according to Equifax too. Again, is this with the interest on?
Other than that I have no unsettled / outstanding debts. Thank you once again :)
Sara (Debt Camel) says
Check Experian and TransUnion too…
“when I called them up previously when discussing the DMP, they told me that my settlement figure is around 6500” how long ago was this?
Danielle says
That was in March 2019
Danielle says
I’ve checked on the other sites too and it says those are my only debts. Everything else is settled or up to date thank you again I’m advance for your help
Sara says
Hi. I have a 12 year old debt with MBNA. I negotiated an interest freeze and have been paying this steadily since. Some years ago they sold the debt on to IDEM and I have continued to pay. About 6 months ago I realised that I am sure I have now paid back more than the original debt was for.
I wrote to IDEM and asked for a copy of the CCA and details of the payment history with themselves and MBNA. They rang me today to say they have posted the CCA but they have no obligation to provide payment history with MBNA.
Is this correct and is there another way I can get hold of it.
Thanks
Sara (Debt Camel) says
“About 6 months ago I realised that I am sure I have now paid back more than the original debt was for.” that may well be the case, but that is not against the regulator’s rules. So I am not sure why you are trying to get hold of this?
When you get the CCA agreement, read https://debtcamel.co.uk/ask-cca-agreement-for-debt/ where there is a section about how to tell if what you have been sent is correct.
Sam says
Hi Sara
Can you please advise on this matter. I had a debt to Natwest, who managed to get a ccj and subsequently a charge order against my house. This was for a debt dated back in 2009 and the ccj was awarded in 2014. Natwest have now accepted an offer in full and final settlement. Does that mean they will remove the charging order once payment is made. I have all communications in writing via email.
Sara (Debt Camel) says
Yes they should remove the charging order, because after the settlement you will no longer owe them any money.
Graham says
Hi
My Barclays loan has been assigned (not sold) to Arvato DCA. I was informed in writing by Barclays to speak to Arvato regarding the outstanding debt. Arvato has sent me a letter stating:
“As discussed in your telephone call on **/9/2019, We confirm that our client will accept £x in full and final settlemt of this account.”
The original Barclays account number and balance is displayed on the letter plus the Arvato reference and full and final settlement offer (50%)
There is no mention about the remaining balance not being sold or assigned to anyone else.
Thank you
Should I insist on a letter to state this or would the original wording suffice.
Sara (Debt Camel) says
Assigned normally means sold. Is Barclays still the client?
Gerard says
Hi Sara
Your blog has been a great help to me and excellent support to people with debt issues.
I’ve recently started managing my own DMP after 9 years of using a fee paying provider. I have reduced a debt from circa £42K to £15k and just thought it was time to manage the debts myself as I have been offered £7k from a friend to offer F&F’s over the next 6 months. Previously paying £300 pm to creditors. (8 x debts with 6 companies 2 x OD’s with original lenders, 5 x Credit Cards & 1 Loan all with collection agencies. I have requested CA’s from all Collection Agencies and as yet 90days later none have been able to provide these. More to follow…….
Gerard says
Following on …….1 x collection company owns 3 of the debts and have advised that one of the debts circa £1900 had not originally defaulted and is now appearing on my credit file. This should have defaulted back in 2010.
I have written to all creditors and supplied an income and expenditure statement with revised offers and await feedback on agreements and i have offered £100 across all 8 debts as i have earned less this past 12 months and cannot afford the £300pm. It appears all creditors will accept the reduced offer but the non defaulted debt mentioned above is causing me concern as the agency are saying that i need to honor the original monthly payment agreed with Barclaycard back in 2010. This makes no sense to me as i have paid various amounts over the past 9 years to my DMP Provider varying from 600 – 300 pm so there would have been variance is what was paid towards this debt.
Firstly what is the best process to get this debt defaulted to original date as i thought the idea of entering into a DMP was that these debts default as a matter of course.
My plan of preparing F&F’s was in the hope i could improve my credit score but before i look to proposing F&F’s i would like this debt removed from my credit file and also this company has not been able to provide me with original credit agreement. Saying that all credit cards & loans in my plan are with collection agencies who cannot proved CCA’s and its been 90 days plus
Gerard says
Hi Sara
Just checking back in. Have you had a chance to review above. I just need to know if I should contact Barclaycard to backdate a default on the circa £1900 debt that is now appearing on my credit file. If this debt can be back dated then it allows me to plan F&F’s going forward. Also since I have now started managing my own DMP am I best to continue paying all creditors monthly even though there are no CCA’s. Any assistance greatly appreciated
Thanks
Gerard
Derek Dart says
Hi Sara,
I have a close relative that had a house repossessed 10 years ago leaving a shortfall of around £40,000 (she only had it 18 months… don’t know how it can lose £40k in less than 2 years? Property was new build and only worth circa £130,000 when mortgaged?? Are that allowed to sell so cheaply leaving the shortfall?
It’s been 10 years and nothing agreed or paid in that time and she keeps getting letters from a solicitor acting for the lender (UCB). She offered a payment of £2k about 4 years ago as she had saved that as a final settlement but no joy… she has not communicated to them since even though she keeps getting letters to get in touch. She can get about £4k as a gift from her brother but will this be enough and bearing in mind the fact they sold it so cheaply which raised questions about their initial valuation/mortgage?
Please do advise…
Thanks
Derek
Nick says
Hi Sara,
i was wondering if you could advise me about a discount offer that I have received from one of my 5 creditors.
Total debt is around 15000 every one of them has been defaulted 2.5 years ago, I haven’t arranged any payment plan so far and one debt collection agency offered 40% discount ( in installments)for a debt that is close to £3000 value.Would accepting this offer make the other debt collectors believe that there is money in my pockets to chase for?Reality is that I don’t have more than £80 a month after paying bills etc but i was thinking clearing one of the debts would take some of my load away
Sara (Debt Camel) says
Do you have £1800 in the bank to settle this debt? If not, don’t consider borrowing money to do this. Not a commercial loan – this debt is now interest free – getting expensive credit to repay it would be a huge mistake. And not a loan from someone in the family either, really you can’t afford to repay it!
Getting £15000 in impossible debt down to £12000 is a start I suppose, but it’s not a huge improvement. If you are renting, not buying, I suggest you should talk to National Debtline on 0808 808 4000 about whether you meet the criteria for a Debt Relief Order before you think about settling this debt.
Would accepting this offer make the other debt collectors believe that there is money in my pockets to chase for? The other 4 debt collectors don’t have someone studying your credit record in detail. You may well be chased more for a payment plan, but that would tend to happen anyway. Creditors don’t forget about you…
Nick says
Sorry I forgot to mention that the discount offer could probably be agreed through instalments (at least that’s what they wrote to me). If I could achieve the same terms with the rest of my creditors (discount plus installments ) that would make it more efficient to me rathen than 5 years payment plan that some debt management company has suggested me in the past
Nick says
No home owner but unfortunately not eligible for debt relief order either as my disposable income after calculating it last time was more than £100 a month
Sara (Debt Camel) says
Is that your calculation? Or a free-sector debt advisers? Has your situation changed?
Nick says
It’s debt advisors calculation after asking me for every possible income and expenditure so it seems realistic to me.
No changes since then but i wish I could get a mortgage in the future so I could save something from the main expense that is my rent , that’s why I thought starting to agree discounted settlement of my debts would make mortgage possible in a couple of years.
Thanks for your help and advice!