Can I write off debt?

We’re often asked if there’s any way to get debts written off. Sometimes creditors may agree to write off part of a debt, or in some cases all of it, but this depends on your situation.

It can also depend on the approach you take to dealing with your debts.

Asking creditors to write off debts

We often speak to people whose circumstances mean they can’t afford to pay anything to their debts, and that this situation is unlikely to change.

You could find yourself in this situation if, for example, you were permanently unable to work, or you have a terminal illness. If you find yourself in a vulnerable situation, there are certain things your creditors can do to help.

In situations like this it may be worth asking creditors to write off your debts rather than keep contacting you to ask for money you don’t have.

Some creditors may agree to do this if you have no assets, and you can show evidence that it isn’t worthwhile or fair for them to keep pursuing the debt.

However, creditors are only likely to agree to this in the most serious cases, and you may need to provide evidence to them, for example medical reports, before they’ll consider this.  

In practice, instead of writing off the debt creditors may simply agree not to contact you about the debt for a period of time.

Dealing with debt and mental health

If you're dealing with a mental health issue that can affect your ability to repay what you owe, it may help you to let your creditors know.

If you send a debt and mental health evidence form (DMHEF) completed by a health or social care worker, your creditors may be more considerate when dealing with you.

Asking creditors to write off some of a debt

In some cases, creditors might be willing to write off part of a debt if you can pay off the remaining amount in a single lump sum, or over a few months. 

This is often known as agreeing a reduced, or full and final settlement.

It’s not guaranteed that your creditors will accept this, and your chances of agreeing it will depend on the percentage you can pay back. But creditors are more likely to agree to this than simply writing off the whole balance.

Worried about paying off debt?

Using insolvency to write off debts

There are a range of insolvency debt solutions which will see some or all of your debts written off.
These include:

England, Wales and Northern Ireland

• Bankruptcy
• Debt relief order (DRO)
• Individual voluntary arrangement (IVA)

Scotland

• Sequestration, or Scottish bankruptcy
• Protected trust deed
• Minimal assets process (MAP) bankruptcy

These insolvency measures have many advantages over trying to make agreements direct with your creditors to write off debts. Insolvency is legally binding and creditors included usually can’t do anything to get their money back.

But there are drawbacks too – some insolvency measures require fees and there’s a risk of losing assets such as your house or car. All insolvency measures will have a serious effect on your credit file.

Advice on writing off debts

If you feel like there’s nothing you can do to deal with your debts, and you want advice on writing them off, we can help. 

We’ll help you to prepare a budget and work out what options there are to deal with your debts. If that means insolvency or negotiating with creditors to write off debts, we can help you with that.

Often there will be other options to deal with your debts, even if it seems like you can’t afford to pay them anything. Use our online debt advice service or call us (free from all landlines and mobiles) to find out more.