If you’re struggling with debt, you may be wondering how long it’ll take for your debt to expire or how long it will last.
This is a very common question that thousands of debtors have in the UK. In this guide, I’ll be shedding light on the question along with an FAQ section for further clarity.
Let’s get right into it.
How Long Before a Debt is Written Off in the UK?
In this section, I’ll be talking about how long it takes before debts are written off in the UK. By “written off”, I mean that you won’t be liable for paying your creditors the debt anymore and they won’t be legally entitled to receiving more payments from you either.
With that in mind, most types of debts in the UK have a time limit of six years from the point when they are initiated.
This means that your debt to your creditor is active for a period of six years from either the point of initiation, or if it has been six years since you last made a payment to your creditor/creditors.
Of course, if you’re delaying payments to your creditor on purpose, your creditor can take court action against you for not paying your debt. This period of six years applies to most types of debts, including credit debts, personal loans, and other loans.
Things work a bit differently when it comes to mortgage loans. For this type of debt, you have a total period of twelve years until it expires from the point of either initiation or the point where you last made contact (or made a payment) to your creditor.
However, when it comes to interest on the mortgage, you have a six year period until it is written off. If it has been six years since the debt was officially initiated or six years since you’ve made any contact with your creditor, your debt will be written off.
If it hasn’t been a lot of time to your debt and if it hasn’t expired, do be aware that you can be chased by a debt collection agency and debt collectors.
Statute barred debt: A step-by-step guide
This is a term you may have heard when addressing your debts. When does your debt become statute barred? This is the question I’ll be answering in this section. Moreover, I’ll also give you some debt advice on what it means for the debt you have to pay.
Let’s get right into it.
When a creditor takes way too long in taking action to recover a debt from you, your debt may be classified as “statute barred” under UK law.
This essentially means that your creditor cannot recover it from you via court action. When your debt is statute barred, it still exists. The unique thing however is that your creditor can’t take legal action to recover it from you.
In technical terms, this essentially means that it has been written off. However, unlike when a debt is written off under normal means and circumstances, a statute-barred debt still exists.
So it is written off, since you don’t have to pay it back, but it still exists and it may matter to potential lenders who look at your credit file and your borrowing history.
If you’re a debtor registered in England, you may want to learn more about the Limitation Act 1980 and how it affects your file, your payment, and when your debt becomes statute barred.
As per the Limitation Act 1980, a creditor can chase a debt for a period of six years if the debt is unsecured. If the debt is a mortgage debt, then the period is twelve years in most cases.
This period is called the limitation period for a debt. It starts from either the time of the initiation of the debt or from the point when you made your last payment to the creditor you owe money to.
The law says that if the limitation period is exceeded, your debt will be written off automatically. All in all, the law does offer certain protections for people in debt.
FAQS
- Does debt go away after 7 years?
In the UK, for most people, unsecured debts go away after a period of six years from the point when they started or six years from the point when they last made a payment to, or had contact with, their creditor.
This period can be twelve years for some mortgage debts.
- How long can a creditor chase a debt for?
Under normal circumstances, they can chase your debt for the normal limitation period, which is either six or twelve years from when the debt was initiated or from the point when they last r had contact with you.
However, this period can change if the debt is statute barred. For most people, when their debt becomes statute barred, their creditors cannot chase them for it using legal routes.
There are other plans and legal options to prevent your creditors from chasing you, such as a DRO or bankruptcy to have your loans written off completely.
- What is out of date debt?
In technical terms, an out of date debt is a debt that has passed its limitation period and should not be active anymore.
This usually happens when a debt has existed for six years (or twelve years for mortgage loans) and it is written off.
You are not legally required to pay an out of date debt back. It is waived off. If a creditor tries to chase you for a debt that has expired, you don’t have to pay the debt and your creditor is doing something you can take legal action against.
- Does Statute Barred Mean My Debt Is Written Off?
By definition, it should not, since your debt still exists as an active debt in your credit history.
However, since you are not liable for paying it anymore and your creditor cannot chase you for it, it is, for all purposes, considered written off.
- How do I know if I have outstanding debts?
There are a number of ways to know this.
You can call your creditors to know how much you owe them. Alternatively, you can take a look at recent bank statements of yours or even your credit report. Try to reach as many sources as possible.
Wrapping it Up
This article covered the fundamentals of how long a debt lasts in the UK. I addressed some key pointers, such as the Limitation Act 1980, your credit file when your debt is statute barred, how long a creditor can chase you for your debt, and more.
I hope this piece helped you understand more about your debt issues. If you need more help, feel free to take a look at my website.