09 Mar 2015

A question about : Early Settlement Offer Advice Needed Pls

Hi, not sure if this is the right forum, but need a little credit score advice.

I have been in debt for about 14 years, 12 of which have been spent paying it off. I still have another 7 years to go, but have just come into some money which would allow me to pay most of it off now, and then the rest over 2 years.

However.. I have also just moved in with my boyfriend, and we want to buy a house together. But, I cant do this at the moment due to my bad credit history (despite having a fairly well paid job). Therefore, until I have paid it all off we cant move.

Now.. a number of the companies I am in debt to are offering me an early settlement offer, some of which is quite significant, and to do some would clear off all my debt now and we could move.

Sounds great! However, I have been using Experian (or the like) to check my history and I noticed a small note about Part Paid (or something), and am now concerned that if I take the early settlement, this will remain on my credit history forever, and stop me getting a mortgage (which I can afford once the debts paid!). If I pay it off in full over 2 years, I know it will be GONE forever!

So... after my long story... can someone please advise me on how early settlements work?

Thank you ^^

Best answers:

  • Hi, i'm pretty certain they have a negative effect on your report as they are classed as an arrangement to pay?
    I'm sure someone will be along to clarify....
  • Thank you. Does anyone know for sure how these work? Looking at the credit report it seems "arrangement to pay" is when you are in the process of repaying, but these seem to be more "Closed - Part Complete" kind of thing.
    But I dont know how this effects credit scores
  • I believe that they are recorded on your credit files as 'partial settlement' this will remain on there until it drops off in 6 years time, but if you are currently paying partial payments/token payments etc anyway, these have the same negative impact and again will remain on there for 6 years so it makes no difference really.
  • Hi,
    Might be worth you reading this thread: