Can your Unsecured Debt be Written Off? Know From our Expert

Can your Unsecured Debt be Written Off? Know From our Expert


We have heard from various friends and adverts suggesting that your unsecured debt can be written off. It sounds too good to be true and most debt solution companies who offer formal debt solutions (especially IVA) entice people to take out formal debt plans.

In many cases, it is better to take debt advice as for most debt solution companies ”debt written off” means that it is either via IVA or assisted bankruptcy.

So, let’s look at this in detail to understand what write off of unsecured debts really means, is it really possible and/or how can this be achieved by your debt management company. 

There are two formal debt solutions which most debt solution companies promote via adverts. Let us know about these two debt solutions in detail:

IVA  – This  is a formal debt solution which is legally binding and supervised by qualified insolvency practitioners. The client name will show on the bankruptcy register of the insolvency department of the UK government.


Can your Unsecured Debt be Written Off? Know From our Expert

IVA normally lasts for five years and if there is no equity in your assets at the end of five years, then it can be extended to further 12 months. At the end of the term of your IVA, if there is remaining debt left, then that can be written off and your IVA could be considered complete with remaining debt be written off. An IVA solution is not a better or appropriate solution for everyone,  it must only be considered after seeking appropriate advice from experienced debt advisors. For more information about an IVA solution you may visit our website www.acmecredit.co.uk

Assisted Bankruptcy – It is known as a bankruptcy solution or making yourself insolvent. Assisted bankruptcy is where a debt solution firm charges you a fee helping you fill an official form for your bankruptcy and follow the procedure.

Statute barred

However, there is a legislation called the Limitation Act, which refers to something called Statute barred.

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

Creditors are unable to legally pursue you for most unsecured debts if, after six years:

  • The creditor has not already obtained a County Court judgment (CCJ)
  • You or anyone else owing the money (on a debt in joint names) have not made a payment during last six years
  • You have not written to the creditor admitting you owe the debt

I am not suggesting that you should ignore your creditors for six years and not paying them will automatically clear your debt that wouldn’t actually work.

As the above explanation suggests, if you start to ignore your creditors, they’re likely 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 i.e. Attachment of earning, charging order or issuing bailiff orders or may be transferred debt to debt collection companies for professional debt collection method.

“Okay, I’ll move house and not tell them!” Some might say, simply ignoring the debt and your creditor is not recommended as your creditor may impose GAIN entry on your credit report which can impact your credit report severely. Ultimately, your creditor or debt collection company will find out your new address and contact details as they know their work very well.

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

Importantly, the act isn’t there to encourage debt avoidance or non-payment and some 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.

While the act does apply to most unsecured debts the debt doesn’t disappear and it’s not ‘written off’ but the act can force the creditor can no longer enforce the debt through the courts.

Finally, the Limitation Act doesn’t apply to all types of debt and some debts such as benefits overpayments and Council Tax don’t need to take court action to enforce debts.

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 Acme credit. 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 sometimes come across cases where a client is on a debt management plan (DMP) with us and out of the blue a creditor, they thought they had paid off years ago gets in contact to ask for 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.

Vulnerable Client Policy

If we believe that our client is a vulnerable client due to his old age, continuous sickness, long unemployment and other various reasons, then our team can prepare a detailed case summary and our report will surely help the vulnerable client to write off the entire debt. For further discussion and to know if your case can be suitable for this solution ,please be in touch with us on 0203 318 0990.


Rajnish Tyagi is an experienced and Cert DR qualified debt advisor at Acme Credit Consultants Ltd, Which specialize in offering suitable debt solutions to clients. He can be contacted via email at debt@acmecredit.co.uk

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Can your Unsecured Debt be Written Off? Know From our Expert