F & F settlement of DMP - is this the best solution?

[ernieB]

Hi All

Longtime lurker but first time poster on these forums.

I have had a DMP with PayPlan for about 6 years now. Total debt of £60k now reduced to around £44k. All but one of the 11 accounts has been sold on from the original lender.

I recently had to sell my business and have an amount now sitting in bank that equates to around 20% of the outstanding debt. PayPlan say this is too small an amount to offer Full & Final settlement but suggested that I may as well try. I have no income at the moment, payments to PayPlan have been reduced to tokens and feel that this would be a reasonable time to offer my creditors a polite now or never offer.

Have done a fair amount of research on this site and others (mainly consumeractiongroup) but am getting more confused the more that I read.

I realise that my credit rating is shot to bits and will be for some considerable time so that's not an issue. I'm approaching 60 now and will not be borrowing anything else from the sharks. I have checked and double checked and there is no PPI on any of the accounts.

If anyone could give me any advice on whether the F & F S route is the best option it would be much appreciated.


ernieB

[Amethyst]

Re: F & F settlement of DMP - is this the best solution?

Do you own your own home ?

Most of the accounts will have been bought for something in the region of 10% of the outstanding debt. Therefore I think a 20% does have a possibility of being accepted, particularly if you are only making token payments long term.

Do you have a list of original creditors and current owners of the debts? Might be other routes - but it sounds like you are more just wanting to get them settled and out of your hair.

[ernieB]

Re: F & F settlement of DMP - is this the best solution?

Hi Amethyst

Thanks for speedy reply.

We do own our home but have an interest only mortgage which is increasing with each missed payment. Our mortgage lender is not willing to offer any re-mortgage. Equity release is not possible because OH is dead against and although she is aware of the problems does not know the full extent. And doesn't want to. We now have son,partner and grandchild living with us.

And yes, I just want the whole thing to be brought to a conclusion if this is possible.

Creditors

Citibank - now transferred to Cabot Financial

Capital One

AmEx - now transferred to NCO Europe

Barclays - now transferred to PRA Group

Lloyds - now transferred to Paragon

M&S card - now transferred to Paragon

MBNA - now transferred to Restons

HBOS card - now transferred to Westcot

[FlamingParrot]

Re: F & F settlement of DMP - is this the best solution?

Hi All

Longtime lurker but first time poster on these forums.

I have had a DMP with PayPlan for about 6 years now. Total debt of £60k now reduced to around £44k. All but one of the 11 accounts has been sold on from the original lender.

I recently had to sell my business and have an amount now sitting in bank that equates to around 20% of the outstanding debt. PayPlan say this is too small an amount to offer Full & Final settlement but suggested that I may as well try. I have no income at the moment, payments to PayPlan have been reduced to tokens and feel that this would be a reasonable time to offer my creditors a polite now or never offer.

Hi and welcome

PayPlan's approach has to be an equitable distribution of any available capital or amount for monthly repayments, they can't advise you to 'prefer' one creditor over another, however, there may be reasons why you may want to do just that, but it would have to be on your own, without PayPlan's or any third party intervention. :thumb:

As you have limited resources, it may be worth exploring which ones are more likely to take legal action and win and which are not likely to be enforceable and concentrate your resources on those. :thumb: To that effect, it would be useful to know a bit more, such as what types of accounts they were (the ones where you didn't mention it already) and when you took out the card or loan to start with, as well as the approx. outstanding balance on each one of them.

Have done a fair amount of research on this site and others (mainly consumeractiongroup) but am getting more confused the more that I read.

I'm not surprised! :lol: :tape2:

I realise that my credit rating is shot to bits and will be for some considerable time so that's not an issue. I'm approaching 60 now and will not be borrowing anything else from the sharks. I have checked and double checked and there is no PPI on any of the accounts.

If anyone could give me any advice on whether the F & F S route is the best option it would be much appreciated.
ernieB

It may be for some of them, however, if you want to find out how likely they are to be enforceable, I'd start by firing CCA requests to all of them (unless they were current account overdrafts). That's what I'd do or, to be more accurate, that's what I've done. :grin:

[FlamingParrot]

Re: F & F settlement of DMP - is this the best solution?

Apart from approximate start dates and outstanding amounts, below are a few questions that may be useful to answer/look into: :thumb:

Citibank - now transferred to Cabot Financial

If the owner is Cabot Financial (UK) Limited, this may be of interest: http://www.legalbeagles.info/forums/...censed+trading :grin:

Barclays - now transferred to PRA Group

What sort of card was this to start with? Was it always a Barclaycard? A Morgan Stanley Dean Witter Card?

Lloyds - now transferred to Paragon

What sort of account was this? Current account? or a card or loan?

M&S card - now transferred to Paragon

Was this originally an M&S storecard later changed into an all-purpose credit card by any chance?

MBNA - now transferred to Restons

Was this originally an MBNA card or one of the many they bought from other sources, such as A&L, Abby, etc.?

[ernieB]

Re: F & F settlement of DMP - is this the best solution?

Hi FP

Thanks for your responses. My initial plan was to offer FF & S on a pro rata basis to appear to be fair to all creditors. PayPlan think there is no chance they will go for this with such a small percentage on offer. I was hoping to show that due to my changed financial circumstances this is there best hope of getting anything other than token payments forever and a day.

At present the creditors have been leaving me alone as I have always made the payments on the DMP. I am a little loath to stir up the vipers' nest by going down the CCA route as I don't think I would get much out of that. Plus I want shot of the whole thing in as short a space of time as possible.

The Barclays/PRA Group account was originally something else, possibly a Morgan Stanley. I will check this.

There are 4 debts on the LLoyds/Paragon. Two loans, a credit card and an overdraft. The debts to Paragon are roughly half the total.

The M&S card was a regular credit card.

The MBNA card was originally just that.

Many thanks for your input.

[FlamingParrot]

Re: F & F settlement of DMP - is this the best solution?

Hi FP

Thanks for your responses. My initial plan was to offer FF & S on a pro rata basis to appear to be fair to all creditors.

Hi

As with everything in life, those who do their job better also deserve better, in this case those creditors who have been more diligent with their paperwork would also deserve better. Of course that's not something PayPlan would say but then they are funded by the credit industry. :ohwell:

PayPlan think there is no chance they will go for this with such a small percentage on offer. I was hoping to show that due to my changed financial circumstances this is there best hope of getting anything other than token payments forever and a day.

Debt purchasers would have paid 10% or less of the alleged outstanding amounts. Some may accept lower offers than others and not having the best paperwork could also be used to negotiate a lower offer, once more, not something PayPlan would advise. :mmph:

At present the creditors have been leaving me alone as I have always made the payments on the DMP. I am a little loath to stir up the vipers' nest by going down the CCA route as I don't think I would get much out of that.

You'd be surprised what you can get out of that, at least in my case and many others I know, quite a lot I may say. :grin: However, if you want to find out what sort of paperwork there would be without stirring anything up as you say, an idea would be to send the CCA request to the original creditor rather than the current owner. If you sent it to the debt purchaser they would still have to go back to the original creditor to get the paperwork so it would amount to the same thing. If you were to CCA, say, Barclays, you could find out what sort of paperwork (if any) they have for the accounts without them informing the current account owner that you've sent a request, even though it's your lawful right to send a request as long as there's an outstanding balance and no judgment. As far as I know Barclays are notoriously bad at retrieving documents.

Up to you. :decision:

Plus I want shot of the whole thing in as short a space of time as possible.

I understand that, we'd all like to be rid of our problems as soon as we can, however, good things come to those who wait, trust me on that one, even though I'm as impatient as they get, there are times when it's definitely worth taking your time. :thumb:

The Barclays/PRA Group account was originally something else, possibly a Morgan Stanley. I will check this.

Someone I know appeared in court earlier this year with an old Morgan Stanley card sold to Barclays, then MKDP, and she WON in court when the judge declared it irredeemably unenforceable. :whoo:

There are 4 debts on the LLoyds/Paragon. Two loans, a credit card and an overdraft. The debts to Paragon are roughly half the total.

The overdraft wouldn't fall under the CCA.

The M&S card was a regular credit card.

The MBNA card was originally just that.

Many thanks for your input.

OK, thanks for that. :yo: Some of those cards were originally something else and thus unenforceable for various reasons, for example MBNA could never locate a copy of my agreement as it was an old A&L card that's why I asked.

[Debt Camel]

Re: F & F settlement of DMP - is this the best solution?

have an interest only mortgage which is increasing with each missed payment.

I am sorry, but can we come back to this? Are you saying you can't meet your mortgage repayments each month? If you are, these have to be your priority, not making F&F offers to unsecured creditors.

Is there equity in the property?

When does the interest only mortgage end? Do you have any form of repayment vehicle? Do you have any pension arrangements?

I want shot of the whole thing in as short a space of time as possible

Understandable. However 6 months or a year of getting token payments will probably make your creditors much more receptive to a low F&F...

[ernieB]

Re: F & F settlement of DMP - is this the best solution?

Hi DC

Thanks for your comments.

We are struggling with all bills at the moment but obviously paying the mortgage is a priority. The mortgage is due to be paid off in 8 years time and we have no plan in place to repay other than to downsize. There is equity in the property but we are unable to release this. I don't want to sell the house now and allow the vultures to circle over the equity. One of the reasons for my keenness to go down the F & F S route is to be enable us to concentrate on a plan for the mortgage. I do realise the settlement plan is not guaranteed but will not have another opportunity to clear the debts.

[Amethyst]

Re: F & F settlement of DMP - is this the best solution?

Bring your mortgage back up to date first, before any F&F offers to unsecured creditors. That is imperative. I think you are right though in sorting out these little debts before selling the house to downsize. Maximise the amount of equity you get to keep to repay the mortgage capital.

[ernieB]

Re: F & F settlement of DMP - is this the best solution?

That is the long term plan Amethyst. Have had no time/money to spend on much needed repairs/improvements to the property.

You are obviously right about the mortgage arrears.

Like your use of 'little debts' even though they do cause a good few sleepness nights.

[FlamingParrot]

Re: F & F settlement of DMP - is this the best solution?

That is the long term plan Amethyst. Have had no time/money to spend on much needed repairs/improvements to the property.

You are obviously right about the mortgage arrears.

In that case you shouldn't even be thinking about full and final settlements, your mortgage arrears are what's known as a priority debt and should come above anything else, including debts subject to a judgment.

You need to look after number one and your home should be in a fit state to live in, never mind those sharks who bought your accounts for peanuts and would like the full amount that was already written off by the banks as a loss for tax purposes.

Like your use of 'little debts' even though they do cause a good few sleepness nights.

They are not worth it! You can only pay what you can afford AFTER your mortgage, your essentials, etc. Even if they took you to court,they couldn't get more than tokens. If it was me I'd keep up the tokens whilst also sending out the CCA requests just to add to your armoury. They want your money not your blood, if they see they can't get any out of you they'll move onto someone who's got more.

I know a lot of people who have overcome their fear of creditors, including someone with debts or around £150k :scared: and yes, also a property owner. :thumb:

[ernieB]

Re: F & F settlement of DMP - is this the best solution?

Hi FP

Once the mortgage arrears are clear there will still be a sum left from the sale of my business to go towards possible F&FS.

There is already one Charging Order on the property courtesy of Restons. I don't want any of the other creditors getting wind of this and doing the same thing. I wish I had your faith that the sharks would move on to someone else. Plus if I do the house up and add to the equity I don't want the possibility of this ending up in the hands of my creditors.

I am looking to draw a line under this (if at all possible) and do not think I could face the uncertainty of paying tokens ad infinitum knowing that the debts have not gone away.

There is some kind of fear over what the vultures might get up to if I stir things up.

I used to be so indecisive, now I'm not too sure!

[Amethyst]

Re: F & F settlement of DMP - is this the best solution?

Do you want to pop some 'outstanding amounts' on this list, add how much mortgage arrears you have and tell us what you have to play with for these F&F's - keep it approx.

Citibank - now transferred to Cabot Financial

Capital One

AmEx - now transferred to NCO Europe

Barclays - now transferred to PRA Group

Lloyds - now transferred to Paragon

M&S card - now transferred to Paragon

MBNA - now transferred to Restons ------------------- is this the one with the charging order ?

HBOS card - now transferred to Westcot

[ernieB]

Re: F & F settlement of DMP - is this the best solution?

Do you want to pop some 'outstanding amounts' on this list, add how much mortgage arrears you have and tell us what you have to play with for these F&F's - keep it approx.

Citibank - now transferred to Cabot Financial -- £2170

Capital One -- £4380

AmEx - now transferred to NCO Europe -- £2130

Barclays - now transferred to PRA Group -- £2890

Lloyds - now transferred to Paragon -- Loan £10820
o/d £1551
Loan £3960
ccd £930

M&S card - now transferred to Paragon -- £2490

MBNA - now transferred to Restons ------------------- is this the one with the charging order - YES -- £6760

HBOS card - now transferred to Westcot -- £2980

Mortgage arrears about £700

Balance after mortgage arrears paid off £5500 ish