23 May 2015

A question about : Santander not allowing Full and Final Settlement

Hello

As some of you know, I'm in the process of settling my debts by full and final settlements.

I have one account left, Santander for Ј3800. I offered 29%, which is low, but was pro rata for the rest of the debts. I've had to tell Santander that some settled for more than the pro rata and I don't know whether they'll accept my 29% or want more.

But the real hassle is that, whatever figure they accept, they're saying that this will not be a full and final settlement. That they only do partial settlements. They say the balance will still show on my credit file, although they also say the account will be closed and they will not pursue for the remainder.

My CAB agent tells me they are plain wrong, and if they close an account it will show as ZERO balance.

But I am worried about balances showing on my credit file, if this happens.

Can someone account for what is going on here, and suggest a way forward as to what I should do?

Best answers:

  • The ballance will be ZERO on the "account", but the data they (and your other creditors) submit to the CRA's will show the ballance and that the accounts have been partially settled.
  • So will anyone looking at my credit file be able to see the partial settlement figures over and beyond the P flag? And should I be worried that they will not use the phrase "full and final" with me?
  • If they have confirmed in writing they won't pursue you for the remainder then there's nothing to worry about.
  • You have some varied and inconsistent advice from the CAB (and others). In circumstances where you have a loan or whatever from an institution, they expect in any circumstances to receive all that you contractually sign up to.
    When you have paid all that you owe, your credit file is marked as settled - settled means you have paid off the debt in full and tells prospective lenders that you have handled that debt exactly as you were supposed to.
    If you decide to offer full and final's to lenders, they may accept that to hold out longer for any more from you is not worth it and will accept a lower settlement amount from you, clear the debt to Ј0 and not pursue or sell on any remainder (get this in writing).
    BUT they are required to mark your credit file with "satisfied" - you have satisfied them in terms of the full and final settlement, but you have not kept your end of the bargain, so you don't get a "settled" on your credit file.
    Different lenders will place different weight on what they see when they assess a credit file but they certainly get no more info that "settled" or "satisfied" or "default" etc and they will look less favourably on a satisfied than a settled as it is an indicator that all did not go well with that lender.
  • Thanks to everyone.
    My CAB advisor tells me that the default is the worst part and therefore settled or satisfied won't make much difference to prospective lenders.
    And the slate is clean in 6 years from the default anyway?
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