Writing an offer letter

[Stan**]

Hi All,

 

I have an outstanding balance on a current account which has been terminated. I have an arrangment with the recovery dept making a minimal monthly payment.

 

I am going to write an offer letter, for settlement of the account from a one off payment. Does anyone have a template or suggested wording for such a letter?

 

Thanks in advance.

[citizenB]

Letter J in the link below should be fine.

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?20758-Creditors-and-DCAs-Letter-Templates-amp-Budget-Planner&p=162363&viewfull=1#post162363

[citizenB]

Just in case the link doesn't work..

 

 

Dear Sir/Madam

 

Re: 4563210025897412

 

We write with reference to the money which you are claiming on the above account.

 

We can confirm that we are unable to offer to pay the money which we owe in full. However, I can raise £775 and I want to offer this as an ex−gratia payment in full and final settlement of the account. This offer is made on the clear understanding that, if accepted, neither you nor any associate company will take any other action to enforce or pursue this debt in any way whatsoever and that we will be released for any liability.

 

We also request that, if accepted, you will make an entry on a credit reference agency file relating to the above account as "satisfied" in full.

 

Payment can be made within 2 weeks of receiving your written agreement of this offer and method of payment.

 

We look forward to receiving your reply.

 

Yours faithfully

Mr A N Other

 

 

[Stan**]

Just what i was looking for, many thanks

 

Is there a general percentage of balance that creditors use to determine what they can accept as an offer? e.g making an offer of 50% of the amount owed.

[citizenB]

The idea is to start low depending on many factors.

 

Are there any default/penalty charges ?

 

How long have you been making reduced payments

 

Do you own your own property ? It is has been discovered that property owners are less likely to be able to obtain full and final settlement offers, for obvious reasons ?

 

 

You could start off at say 15-20% and let them make a counter offer.

[Stan**]

Hi, thanks for the reply.

 

I cant remember the exact figures, but approx: current balance = ~£2000, of which ~ £500- 750 are charges, they have already said ~£1200 would settle the account.

 

I was going to go with a low, low offer of £500 and work from there.

[slick132]

Hi Stan,

 

Approx how old are the penalty charges on the a/c. If they go back a few years, you could wipe a decent amount off what you owe by reclaiming penalty chgs plus compound restitutionary interest.

 

[Stan**]

Hi Slick,

 

I'd have to check but Id say the most recent was at least 2 years, with the oldest being probably 4-5 years.

 

Hmmm maybe this would be a fruitful route!

[slick132]

Hi Stan,

 

If you don't have your old statements, send BC a SAR to get this info asap.

 

Better to try to reduce the a/c balance as far as poss with a refund or reduction, and then offer to settle based on the reduced figure.

 

[Stan**]

Makes sense, thanks for the advice!

[Stan**]

Slick/anyone,

I also have a default notice on this account, and I am expecting bank fees to total at least half of the remaining balance (SAR letter sent today)

 

Do you think I would be able to get the default removed as part of the settlement? since the fees genuinely contributed to the fact I defaulted.

 

Thanks!

[slick132]

Hi Stan,

 

If you can show that the a/c balance includes a significant amount of penalty fees, you have a good chance of having the adverse CRA data removed if you take court action to secure the refund.

 

Have a read through this thread - http://www.consumeractiongroup.co.uk/forum/showthread.php?364605-BARCLAYCARD-**WON**-Charges-repaid-with-compound-int-t-and-DN-removed**

 

[Stan**]

Thats an excellent read, thanks mate.

 

This has put a new approach on this account - not just to clear the balance but to remove the CRA DN marker.

 

I think I may have quite significantly under-estimated the amount of fees levied on this accnt - I distinctly remember in one instance making a cash deposit of £500-600, which I begged and borrowed for, after being hounded for a week by Barclays collections to bring the account up to date - this was only from a spiral of fees as I wasnt using the accnt for DD's/purchases etc. And im certain this wasnt a one off occurrence!

 

SAR data will reveal all - I will post when I have this in hand

[Stan**]

Update- I have received all statements since approx 2001.

 

I need to do some digging, as I reclaimed penalty charges on this account several years ago, so I do not want to overlap this claim with the last and make a double claiim.

But if I go back 6 years (I think previous claim was approx 7 years ago), and use interest in restitution of 8%, then there is approx £4000 in penalties! The default notice is for ~£2000.

 

1) is 8% the correct figure to use for int'st in rest'tn?

 

I really want to focus of this claim to be on removal of the default notice, dated approx 1 year ago.

 

2) are there any suggestions / templates for a claim letter based on this situation? I am really wanting the wording of the removal of the default notice to be critical here; I do not want it marked as satisfied, I want ALL negative markers removed, so I do not want to trip up on this request!

 

As always, any/all input is welcome.

 

Thanks

Chris

[slick132]

Hi Stan,

 

Any charges that you have already reclaimed cannot be the subject of a further claim, regardless of the interest that you claimed at that time.

 

Any charges that you now reclaim (since the last occasion) can be claimed in full, plus compound restitutionary interest at 24.9%. Use a compound int't spready for this.

 

To get the adverse CRA markers removed, you will have to file a court claim and include DN and adverse CRA marker removal as part of the claim.

 

Let us know how the spready figures look.

 

[Stan**]

Wow, I thought 24.9% is only applicable to credit cards?!!

At that rate, the total claim is ~£6500

 

I will draft a letter and post it here for review

[slick132]

Hi Stan,

 

Apologies !! When you referred to reclaiming penalty chgs and adverse markers in post #14, I was thinking this was a credit card a/c. I made the same error earlier in the thread too.

 

I see now (from your first post) that this is about a bank current a/c so reclaiming charges is not a likely option, unless they were applied since April 2011 AND the bank were aware that you were in Financial Difficulty.

 

Really sorry about the confusion here and possibly giving you false hope.

[Stan**]

Hi Slick,

 

No problem, thought it might have been too good to be true!!

 

Certainly the critical period which lead to the hardship and ultimately default was over the last 2-3 years. I explained financial difficulty only over the phone - to be admissible in court I assume it would have to have been in writing?

 

How would I stand in terms of reclaiming charges from 2011 - closure of accnt, and having the DN removed from CRA?

[Stan**]

To summarise:

 

-Current account terminated leading to DN, with outstanding balance of ~£2000

-Charges since April 2011 = ~£1000

-No written correspondence BEFORE default explaining financial hardship

 

Monies aside, I really just want the DN removed!

[slick132]

Hi Stan,

 

When was the a/c closed and were any charges and/or interest added after then.

 

If there is lending involved, such as an overdrawn a/c, then The Lending Code may apply. See the Article here - http://www.consumeractiongroup.co.uk/forum/showthread.php?387436-Letter-for-consideration-regarding-Hardship-or-Financial-Difficulty

 

The Lending Code says that banks should be pro-active in identifying customers in difficulties. If you told them by phone, that should be available to the bank as a file note or recording although the bank should have identified you as a customer in need and maybe offered to stop adding charges and/or interest.

 

Be aware that removal of a DN and/or adverse credit markers may be very difficult.

 

[Stan**]

Hi Slick,

 

The account was closed approx 10months ago. No further charges were added after it was closed.

The balance was an over-draft.

 

So what is the actual status on penalty charges; when are they classed as unlawful?

[slick132]

Penalty or default charges on a bank current a/c are not unlawful, unlike penalty charges on credit card, loan, catalogue or mortgage accounts.

 

So your best chance of any refund is to use The Lending Code or BCOB's.

 

Edited March 10, 2014 by slick132

[Stan**]

I have written a letter for a reclaim of fees since November 2009 and removal of DN, based on breach of BCOB Reg 5.1.1 and Reg 5.1.14.

 

Please could someone confirm the correct address to send it to?

 

Thanks in advance.

[slick132]

Barclays Bank plc

Head office customer relations

1 churchill place

london

E14 5HP

[Stan**]

Thanks Slick...