Full and Final Settlements

Settlements in Full and Final


  • Settlements in Full and Final are short settlements of balances. They form a partial payment of an     outstanding balance and clear the total outstanding at an agreed discounted rate.
  • The discounted debt should be written off by the respective creditor if the full and final settlement     offer is accepted and the debtor should not be pursued for any further amounts regarding that account at a later date.
  • It is very important that any full and final settlement offer letter that is sent to a creditor is worded correctly. If not, the creditor could pursue the debtor for the remainder of any     outstanding balance for that account at a later date.

  • Creditors can mark credit files as satisfied, short settlement or settled. This can still impact credit scores as the Defaults or CCJ's remain on file for up to 6 years from the entry date.
  • There is no guarantee that a full and final settlement or settlement in full and final will be accepted by a creditor.
  • Personal Debt Companies may take fees for making full and final settlement offers to creditors on behalf of debtor clients, rates or charges for this service can vary from 10%     upwards of the savings made on behalf of the client.
  • If a person comes into a lump sum of money they are sometimes in a position to make a full and final settlement offer to any creditors they may have, even if this money is borrowed.