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Write off Unsecured debts – Possible?

The short answer to write off unsecured debts is ‘yes,’ because there are certain debt solutions that include having some or all of your unsecured debts written off. These methods are commonly utilized by individuals who are unlikely to be able to pay their obligations in full within a reasonable amount of time.

For those who are struggling with unsecured debts, however, these debt options will not be ideal. The majority of these solutions have strict qualifying requirements; thus, depending on your personal and financial circumstances, you may or may not be eligible to utilize them.

Repaying all your debts in full is not always necessary, and there are several different sorts of debt relief. However, if you do choose to take advantage of one of these options, it’s important to understand the specific terms and conditions that may apply.

Anything to be aware of?

Take note that any type of debt solution that doesn’t involve repaying all debts fully is more likely to have a negative effect on your credit score, making it harder for you in the future to be approved for new lines of credit. Also, depending on the situation, your personal information may go public (e.g. Insolvency Register), and you might face limitations when trying to work in specific fields.

While the idea of writing off some or all of your debt might sound appealing, it may not be the best solution for you depending on your financial situation and future plans.

A quick summary

The following are the most typical UK debt solutions that could involve having some or all of your unsecured debts written off:

  • Individual Voluntary Arrangement (IVA):This is a legal agreement between you and your creditors in which you agree to make one affordable monthly payment toward your unsecured debts over a set period of time (often 5 years). The remaining amount of your unsecured debt will be written off after you complete your arrangement. Find out more.
  • Bankruptcy: If you are insolvent, meaning you cannot pay your debts, you may be able to declare bankruptcy. Bankruptcy usually lasts for one year and discharges most of your remaining debt; however, any extensive assets (including your home) will more than likely be sold in order to repay what is owed, and even after declaring bankruptcy you will encounter difficulties obtaining credit or working in specific professions.. Find out more.
  • Debt Relief Order (DRO): This is a simplified version of bankruptcy that may be a suitable debt solution for you if your assets total less than £2,000, you have no more than £75 per month disposable income, and your debts total no more than £30,000. The debts mentioned in the DRO are settled (written off) after one year has passed since its declaration. Find out more.

Remember that each of the previously mentioned debt remedies has its own set of criteria for eligibility, and there are advantages and disadvantages with each. In addition to the above, there are also other debt solution options which ultimately involve repaying all your debts in full, including Debt Management Plans (DMP). The government has a page on debt solutions here

Struggling with debts? Contact us today!

If you’re struggling with debts, contact us to find out about a wide range of practical debt solutions that help people deal with their debts and get on with living their life.

Pick up the phone and call us free on 0800 169 1536 to speak with one of our fully trained advisors. They will take the time to listen to you and learn about your debt, your life, and what you hope to achieve. Our team is empathetic to your situation and will work with you find a solution that meets YOUR unique needs–not anyone else’s.

Call us today on 0800 169 1536 for confidential, no-obligation debt help and advice. Or you can complete and submit our online Debt Help form and we’ll call you back

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Customers can get free debt advice from the Money Advice Service – an organisation set up by the Government to offer free and impartial advice to those in debt. For more information from the Money Advice Service visit www.moneyadviceservice.org.uk. MAS is part of the Money & Pensions Service. We are not affiliated with MAS in any way.

Become Debt Free is a trading style of Re10 (Finance) Limited Registered Number 04651137.  Data Protection Act Registration Number – Z8613095

Become Debt Free specialise in providing and administering Individual Voluntary Arrangement (“IVA”) solutions to individuals based in England, Wales and Northern Ireland.  We do not administer Debt Management Plans, Debt Relief Orders, or any other debt solutions.  We only provide advice after completing or receiving an initial fact find where the individual(s) concerned meets the criteria for an IVA, therefore, all advice is given in reasonable contemplation of an insolvency appointment.

* To qualify for debt write off in an IVA with us, you must have a minimum of £7,000 of qualifying unsecured debt owed to two or more creditors.  The amount of debt write off is based on your own personal circumstances – typically this could be up to 85% of what you owe; and this has been achieved by over 10% of our customers who have successfully completed their IVA’s in the last 12 months.  The amount of debt write off differs for each customer and is dependent upon their individual financial circumstances and subject to the approval of their creditors.

Andrew Bowers is authorised in the UK to act as Insolvency Practitioner by the Insolvency Practitioners Association.


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