Is it possible to write off my unsecured debts?

Yes – and we can help you! In some debt solutions, some or all of your unsecured debts will be written off after an agreed amount of time.

These solutions are usually only available to people who can’t afford to repay their debts in full within a realistic time frame.

If you’re interested in one of these solutions, you’ll need to make sure that you meet the eligibility criteria, and it’s important to consider how it might affect you.

How will having my debts written off affect me?

Having some or all of your debts written off can have both positive and negative impacts on your current lifestyle and future plans.

Missing payments, making reduced payments, or entering debt solutions can also impact your credit score and make it more difficult to get new credit in the future. If some or all of your debts are written off, it’ll show on your credit report and can have a negative impact.

Any positive or negative factors on your credit report will only show up for six years from the date they’re approved, and you’ll have to tell lenders if you apply for credit in the future if they ask.

If your debts are written off through an insolvency debt solution, the details will appear on the Insolvency Register for the duration. In this time, you’ll need to stick to the terms of the agreement. There are some restrictions in some employment sectors or roles, so you’ll need to make sure that your current or future employment plans won’t be affected.

A Quick Summary of Insolvency Debt Solutions

Here’s a quick summary of some debt solutions that involve debt write-off in England, Wales and Northern Ireland:

Individual Voluntary Arrangement (IVA):

An IVA is an insolvency debt solution. It’s a legally binding agreement between you and the companies you owe money to. You’ll agree to make one affordable monthly payment for an agreed amount of time (usually five years), and they’ll agree to freeze your interest and charges, not take any legal action, not chase you for payments and write off any unaffordable debts included in your IVA, at the end of your plan. Find out more.

Bankruptcy

This is an insolvency debt solution that usually lasts for a year, and after this, any outstanding unsecured debts are written off. You might have to make payments for up to three years, depending on your circumstances. With bankruptcy, any significant assets (including your home) are likely to be sold off to repay your debts, and even after you have been discharged from bankruptcy, you could still face restrictions in obtaining further credit and working in certain professions in the future. Find out more.

Debt Relief Order (DRO)

This insolvency solution has strict eligibility criteria, but your unsecured debts will be written off after a year. In a DRO, you won’t need to make any payments. Similarly to bankruptcy, even once you’ve been discharged, you could still face some restrictions when applying for credit or working in certain professions. Find out more.

Here’s a quick summary of some debt solutions that involve debt write-off in Scotland:

Trust Deed

This insolvency solution is an agreement with the companies you owe money to. You’ll make regular, affordable payments towards your debts for an agreed amount of time. If they accept your Trust Deed proposal, they’ll freeze any interest and charges, cease legal action and reduce the contact you receive. Any outstanding unsecured debts included in your Trust Deed will be written off when you complete your plan. Find out more.

Sequestration

Also known as bankruptcy, with this form of insolvency, a Trustee will take control of your assets and is authorised to sell them to raise funds to repay your creditors. It usually lasts for a year, and after this time, you’ll be discharged from the sequestration process, and your outstanding debts will be written off. Find out more.

Minimal Asset Process (MAP)

With this insolvency solution, you’ll be declared bankrupt for six months, after which all your debts will be written off. Find out more.

A Quick Summary of Other Debt Write-Off Solutions

Short Settlement: This isn’t a form of insolvency, and the companies you owe money must agree. If you’ve got little to no disposable income and a lump sum available that is less than the total balance you owe, you can use this to make an offer to the companies you owe money to. They will either agree to write off some or all of your remaining balances or decline your offer. Find out more.
Debt Write-Off: Some creditors will agree to write off debts if an individual meets their specific and strict criteria, such as suffering from a terminal illness or being a victim-survivor of economic abuse. However, there isn’t a set timeframe for a creditor to make a decision, and there are no guarantees that they’ll agree to it.

Not sure which way is best for you?

Don’t worry; our specialist debt advisors are here to help!

Our free debt advice and solutions are FCA-regulated and confidential, and there’s no obligation to go ahead.

To find out which options are available, call us free on 0800 316 1833 or complete our quick and easy online form.