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Joshua
Joshua, Lawyer
Category: UK Bankruptcy Law
Satisfied Customers: 25358
Experience:  LL.B (Hons), Higher Prof. Dip. Law & Practice
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If you owe money to creditors, collection agencies etc. and

This answer was rated:

If you owe money to creditors, collection agencies etc. and you’re about to pay off the remaining balance in full; Is it appropriate to “make a deal”?

i.e. if you owe £10,000 can you make a settlement offer of £9000?

Would this be accepted by collection agencies? Bearing in mind if they’ve been wanting the money for a considerable length of time.

Joshua :

Thanks for your question. Please kindly RATE my answer when you are satisfied

Joshua :

Is there any form of court judgement in place please or have matters proceeded without recourse to court?

Customer:

No court judgment, no.

Customer:

Just the usual letters in the mail etc.

Customer:

reminders

Joshua :

Thanks.

Joshua :

If there is no judgement against you in the creditors favour there is nothing stopping you attempting to strike a deal.

Customer:

Would it be a final settlement" ?

Customer:

ie they couldn't come back 6 months down the line and ask for the remaining amount(s)?

Joshua :

It is very much a case of painting the right picture. e.g. you may be able to borrow some money from a friend to settle the debt but can only borrow say £8000 and so on or whatever story you feel comfortable with. Creditors will often accept a reduced settlement for an account.

Customer:

ok - thanks.

Joshua :

An alternative is to settle with them on a technicality. If you send them a cheque for the amount you wish to settle under cover of a letter that states the cheque is in full and final settlement.

Joshua :

If they then bank the cheque this is taken as strong evidence of acceptance of your terms.

Customer:

I see.

Customer:

I'll try the - "this all I have, as I've borrowed the money, will you accept final settlement"

Customer:

I guess I have to get them to confirm (in writing) they accet the final settlement

Customer:

"accept"

Joshua :

Providing you use the cheque and covering letter approach their banking the cheque is evidence of acceptance but if you can get them to commit to confirm in writing before hand this is all the better.

Customer:

ok, thanks

Customer:

makes sense.

Customer:

I assume from their perspective

Customer:

they prefer a final settlement

Customer:

rather than spending more money and time chasing

Joshua :

Quite so. It is worth accepting less rather than holding out for the full sum. Something is better than nothing as they say. However there are no hard and fast rules and much will depend upon what they know about your financial circumstances and their business model in terms of writing off bad debts.

Customer:

got it

Customer:

thanks for everything

Customer:

life is funny

Customer:

anyway

Customer:

thanks again

Joshua :

A pleasure. Good luck negotiating.

Customer:

wonderful service

Customer:

lets see

Customer:

I'll rate you now

Joshua :

Many thanks

Joshua and other UK Bankruptcy Law Specialists are ready to help you