It is possible to negotiate and settle debt for a lower amont, like only paying 75% off it?

Question

THE PERSONS SITUATION

UK TENANT

GOT INTO DEBT AS WENT ONTO BENEFITS/INCOME SUPPORT FOR 2 YEARS

IS NOW WORKING AND WANTS TO COVER PART OF THE DEBT-CANT AFFORD ALL OF IT

Answer 1

Yes, it's possible, and you can do it yourself without the assistance of a "debt consolidation" or "debt management" company.  How much you reduce the debt, and how good the terms are, depends on the size of your debt and your persuasiveness.  A company may be able to argue more effectively on your behalf, but they will also take a small share of the repayment for their trouble.

Please don't use all caps - it's the written equivalent of shouting and is therefore rude.

Answer 2

it all depends on the creditor's position.  If its a huge company to whom the debt is owed, they may allow monthly instalments (as a means of repayment) at a reasonable rate.

If its a private individual who may be in desperate need of the funds her/himself, you may have a battle on your hands.  

I do not think (though I say this slowly as I'm not 100% certain)...that you can simply have debt "written off" unless you declare yourself insolvent.  In this case, it will wreak havoc on your credit records.  It may help to pay less but it is the only way in which you can say you simply do not have the money.  If you owe money, you are responsible for paying it back.

Why not consider a "crisis loan" from the council?  How about applying for Tax Credits if you are on a low income?  

Wish you all of the best.

Answer 3

You may be able to negotiate lower payments over a longer period but you are unlikely to get the debt reduced.  I had the same situation a few years back due to 3 years off work, ended up 16 grand in debt which took 5 years to clear after i got back to work. Lived hand to mouth for 5 years.

Answer 4

Yes, please loan me $1,000 and afterwards we can negotiate what I owe you back down to $250. Sounds like a great idea. Wish I had thought of this a long time ago.