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Writing off Debt | Debt Article

Writing off your Debt

You may have seen stories in the news about people having thousands of pounds worth of debt written off, however this is actually very unusual.

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In today’s troubled economic climate, there are more and more companies appearing who claim they can help you to solve all of your debt problems. One of the most common services that you’ll see offered in adverts is the promise to write off any credit card, store card or loan debt from agreements that you took out prior to 2007.


Be very wary of any company advertising this service, as they have been identified as one of the most disreputable types of financial service around today. The statistics relating to how many people have actually had debts written off in this way are less than clear and the companies offering such services often charge high fees.


The basis for the claims is the Consumer Credit Act, which lays out very specific rules as to how credit agreements should be constructed and issued to consumers. Many people have claimed that they were mis-sold agreements, and that collecting the debt is therefore ‘unenforceable’ for the creditor. Note that this means the debts are not necessarily written off, but are just not able to be collected.

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However, the good news is that people do occasionally manage to get their debts written off by going to court to show that they were mis-sold, i.e. that the agreement issued by the lender did not abide by the Consumer Credit Act rules. A number of legal test cases have been going on in the past months to try to show that debts are unenforceable for this reason.

Depending on your own circumstances, you may be able to pursue a case to show that you were mis-sold a loan or credit agreement, however be aware that it is the minority of people who do indeed manage to do this. If you think you may have a case you’ll need to seek legal advice, and can do so initially through the Citizens Advice Bureau.

Exceptional circumstances

The Consumer Credit Act cases aside, there are cases where creditors will agree to write your debts off, for example if you are very ill or elderly and are unlikely to be in a financial position either soon or in the future, to pay your debts off. These cases are naturally only in exceptional circumstances, but if you feel this may apply to you, again, you need to seek advice, for example from the Citizens Advice Bureau. You will need to provide proof of the circumstances that mean you are unable to repay the debt.

Legal system

This is one of many areas currently being explored within the British legal system, and the situation is very changeable. However, it’s not wise to rely on having your debts written off in this way as it is unusual, and history suggests that the courts will tend not to be too sympathetic to people looking to have their debts wiped out in this way.