“Your debts written off!”: Is it too good to be true?

posted by in Bad advice, Debt, IVA

If you need debt help now, use our online counselling service Debt Remedy or call us. We’re a debt charity and we can help.

Debt wipe out

Can you rub out your debts?

We’ve all heard or seen adverts suggesting that it’s possible to get your debts written off. It sounds too good to be true, for one reason. It usually is too good to be true.

In most cases it’s a way of enticing people in debt to take out a formal solution. There have been other less than satisfactory solutions offered by fee charging companies over the years that were less than effective, although many of these have now been outlawed thankfully.

In virtually every case it would be better to come to us for proper debt advice (you can get counselling via our online service Debt Remedy).

So what do they offer? For the most part “debts written off” means either an individual voluntary arrangement (IVA) or assisted bankruptcy.

Let’s look at these two in more detail.

An IVA is a form of insolvency that if you qualify for would see you in a legally binding arrangement with your creditors, overseen by an Insolvency Practitioner. IVAs usually last five to six years and in most cases creditors agree to write off a percentage of your debt.

An IVA is no easy ride and isn’t the best solution for everyone.

Assisted bankruptcy is where a company charges you a fee to help you go bankrupt. Although you can do this yourself if you want, most companies try to charge to help you fill in the official forms.

If bankruptcy is the best option for you StepChange Debt Charity has a specialist bankruptcy team that will guide you through the process for free.

Statute barred

However, there is piece of legislation called statute barred. This refers to the Limitations Act.

This is the only real piece of debt law that could see your debt deemed unenforceable, after a period of six years.

Creditors are unable to legally pursue you for the debt if, after six years;

  • The creditor has not already obtained a county court judgment (CCJ)
  • You or any one else owing the money (on a debt in joint names) have not made a payment
  • You have not written to the creditor admitting you owe the debt

So, I hear you cry, “All I have to do to get my debts written off is ignore the creditors and not pay them anything for six years!”.

Erm no, not really, that wouldn’t actually work.

As the above explanation suggests, if you start to ignore your creditors they’re liable to get in touch with you rather quickly and may even do this through the courts, by obtaining a CCJ or other debt collection procedure available to them.

“Okay, I’ll move house and not tell them!” some might shout.

That really won’t work either as it’s your responsibility to keep your creditors updated with your current address. Moving house and not telling your creditors where you’ve gone is seen as debt avoidance. This isn’t recommended.

The Limitations Act

The Act isn’t there to encourage debt avoidance or non payment and most judges will take a dim view of this tactic. It’s there to protect people from being forced to pay debts that have ‘timed out’ through no fault of their own.

The money owed itself is not written off; it’s still a debt and in reality it still exists, but with the Act in force the creditor can no longer enforce the debt.

The important thing to remember is that there are laws to protect you from being chased for very old debts that you weren’t aware of. However these laws cannot be twisted to help you get away without paying.

We find our clients are genuine in wanting to do their best to repay as much as they can afford to their creditors and at StepChange Debt Charity we want to do our best to give you the correct advice and guide you through the maze of legislation while being impartial and honest at all times.

We come across cases where a client is on a debt management plan with us and out of the blue a creditor they thought they had paid off years ago gets in contact to demand some money.

If this happens to you we can look into the case and give you the best advice for your circumstances. If the debt is genuinely statute barred we can give you all the advice and support you need.

Otherwise the promise to have “your debts written off” is simply too good to be true.

Matthew worked as an IVA drafter prior to working in social media. In a former life he wrote scripts for Eastenders, Emmerdale and Hollyoaks. He has 3 chickens, 2 dogs and a rabbit.

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Tags Bad advice Debt IVA
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  • moneyaware


    You should check with the letting agent – it may be that the rooms were rented to you separately and you have different tenancy agreements. That way you would not be affected by any action to collect your cousin’s rent. However what is more likely is that you signed a joint tenancy agreement – in that case the money outstanding would be for a total rental amount and you simply agreed between the two of you to pay 50/50. It is likely the landlord would chase you both for the debt and you would be jointly liable.

    Speak to the letting agency and ask about your options. They may agree to free you from the terms of the contract though I don’t assume this is something they would want to do.

    Shelter have a section on private renting that you may find useful http://england.shelter.org.uk/get_advice/private_renting

    Good luck with it.


  • one

    Hi , I m on i debt plan with Harrington brooks. This company paying every month for creditors. Some creditors, unhappy with that, refused offer, but debt company paying them Did they can ask police to arrest me on airport, when i traveling home??

    • moneyaware

      Hi and thanks for your message.

      The police won’t arrest you unless you commit a crime, not being able to pay your debts in full thankfully isn’t a crime.

      If a debt management plan is the best solution for your debt problems it’s worth noting that we provide them free of charge.

      I hope this helps.

      Kind regards,


    • Karl Frankham

      In my experience I would avoid Harrington brooks. I was paying them £80 per month to go towards my creditors. I later found out that only £37 was going to my creditors and the rest to them for ‘admin’ fees. Total rip off. To be safe I would ask for a statement to see where all your money is going. Good luck.

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  • Kaine Manchester

    I had a mortgage 8 years ago to which got repossessed. I received a ccj with connections to a car finance company in which the car was written off but my insurance didn’t pay out this debt was transferred onto the mortgage yet this was an unsecured loan. Anyway cut a long story short my credit history has now been cleared and the defaults have come off my record after a 6 year period. Is it still possible for debt collectors to come after me for money owed. Do I contact them as I’ve recieved a letter requesting my whereabouts. And where do I stand I’ve been told to ask for original paperwork and contracts to which they will have difficulty providing and I’ve also been told that the debt will be written off. On my credit profile all debts and defaults show as settled. What does this mean?

    • moneyaware

      Hi there Kaine,

      if a debt becomes a CCJ then the Limitations Act (which is the 6-year period I think you may have been advised on, judging from what you’ve told us) will not apply. It can be enforced down the line by the county court and it will remain on your credit file indefinitely.

      If you dispute this CCJ for the reasons you gave us, it might be worth getting in touch with the court who handled the CCJ and ask them how to go about doing this. You may be able to fill in an N9B dispute form but it’s worth checking with the court before you do so in case it’s too late to use that form: http://www.moneyclaimsuk.co.uk/PDFForms/N9B.pdf

      If it turns out that you’re liable for this CCJ and need to start paying back, please get in touch with us because we’ll be able to advise you on how to deal with it and any other debts you have,

      If there are other debts there that have surpassed the 6 year timeframe for a creditor to establish payment but have NOT yet gone to county court, simply follow our step-by-step guide here: http://moneyaware.co.uk/2013/10/statute-barred-debt/

      Best wishes


      • Kaine Manchester

        Thank you so much for this information

  • Ian Adamson

    Hope you can help,
    I have an unsecured bank loan with £6000 outstanding although the original loan was for around £2200 so I’m presuming it’s interest and charges etc. I’m not sure of the exact date the loan was taken out but it was around 2007-2008. I had increase in my epilepsy condition not long after taking out the loan and was unable to work and haven’t since nor made any payments or contacted the bank (stupid I know). I only made around 3 re-payments after taking out the loan at the beginning. I have heard nothing for years until about 4 months ago from a debt company, which I ignored. Three days ago I received a county court letter. Do I admit this full amount, and offer to make a payment although this would be low as I’m unemployed or take another route, any advice would be appreciated. Thanks.

  • Ian Adamson

    Hi, hope you can advise,
    I took out an unsecured bank loan out sometime around 2007-2008 for approx £2300. After paying about 3 payments back my epilepsy condition became worse and I was unable to work and haven’t since. Been stupid I have never contacted the bank or any debt letters that came shortly after. Six to seven years on I started to receive debt letters again from a debt company demanding just over £6000 to clear the debt, this was about 5 months ago and they sent about three. Last week I received a county court letter asking do I agree with the debt or contest. Not sure what to do here, Do I admit to this new amount and send an offer to the debt company which would be low being unemployed, but then risk them turning it down and would the court then send the bailiffs or would they see I’m unemployed and deem the offer acceptable or should I contest this amount or because the loan is so old am I able to ask it to be written off? Clock is ticking on filling this form out and no idea what to do.
    Any help would be appreciated. Thanks.

    • moneyaware

      Hi Ian,

      The debt may be Statute Barred. That means the statute
      of limitations has passed and the debt is no longer legally enforceable. You still owe the money, and can chose to pay it back but the creditor cannot legally enforce it. Here is an article clearing explaining how to deal with a statute barred debt http://moneyaware.co.uk/2013/10/statute-barred-debt/

      If you were to make a payment now, the statute of limitations would begin again (and last for a further 6 years).

      Read the article and send the template letter to the creditor. Respond to the CCJ lodging a defence that the debt is statute barred.

      If the debt is not statute barred and the creditor sends you proof of that, you should make an offer based on an amount you can afford. The county court will rule what that is after they’ve seen your budget.

      Hope this helps.



      • Ian Adamson

        Many thanks for your quick response. I will take your advice, see what happens and post the outcome, again many thanks.

  • Pam Rogers

    I am present on a DMP – which started four years ago – my current debts amount to £18,500. One of my relatives has offered to help pay off my debts with a sum of £5,000 – would this go any way to paying off all my debts? I am a pensioner and currently paying £130.00 a month – I will be 81 when the debt is paid if I continue monthly payments!

    • moneyaware

      Hi Pam,

      Thanks for posting. It would depend on how willing your creditors were to accept a reduced settlement really. Sometimes they can be willing to take vastly reduced sums and other times they can be insistent on receiving the full amount owed.

      Using £5,000 to clear a debt of £18,500 would need your creditors to accept about 27p for every £1 you owe. This is fairly in the context of full and final settlements but it’s worth investigating.

      If you give your DMP provider a call they should be able to give you advice.

      Kind regards


  • moneyaware

    Hi Naomi,

    I’m sorry to hear that you’re having a hard time at the moment. Debt can be incredibly stressful, particularly when there are other issues to deal with at the same time, like a health problem.

    Here’s my thoughts on the situation:

    Santander debt – this debt is in your name but someone else spent the money. You could try to get this other person to pay back this debt but legally they’ve got no responsibility to repay the debt if it’s just in your name.

    Barclays debt – If there’s fraud on your account then I’d hope this should mean that your account is returned to how it was before you were a victim of the fraud.

    Vodafone debt – I’d recommend you ask for a detailed statement from them to prove that you owe them this amount. It seems strange that there’s such a large charge when you were out of contract. They should be able to clarify this for you.

    It sounds like these debts are causing you a lot of worry. I’d recommend that you give our helpline a call: http://www.stepchange.org/Contactus.aspx. We’ll be able to give you advice about how to deal with these debts.

    Kind regards