Writing off all of your debt(s) can be extremely hard for a number of reasons. 

That being said, it’s true that you’ll never be obligated to pay more than what you can afford and if you can’t afford to pay at all, then you’re going to have to find a debt solution that accommodates you. 

In this post, I’ll be looking at how you can write off most or all of your debt(s) by utilising different types of debt solutions available to you in the UK. 

If You Can Afford to Pay Some of Your Debt

While it can be tempting to just get all of your debts written off, I highly urge you to check your finances thoroughly and see whether you can pay off a portion of your debt or not. 

This is important because completely writing off your debts can have unforeseen consequences which can really cause you a great deal of stress in the future. 

It’s almost always better to opt for a debt solution that involves you paying off at least a portion of the money you owe. 

For example, an Individual Voluntary Arrangement (IVA) is a formal debt management solution which involves you making monthly payments towards your debt for an agreed-upon period of time. 

When this period ends, your creditors agree to write off any remaining unsecured debts you have. 

While you certainly have to pay a significant portion of your debt when you enter into an IVA, the great thing about it is the fact that it protects all of your assets. This means that they cannot be seized and sold off by your creditors in order to raise funds for your debt. 

Furthermore, an IVA is legally binding for creditors. This means that your creditors cannot take further legal action against you when an IVA is put in place. 

It can be a good idea to seek debt advice from a professional to see whether you have any capacity to enter into an IVA. 

Please note that entering into an IVA will almost always be better (assuming that you can afford it) than a debt management solution which involves you completely writing off your debts. 

A debt management professional might be able to come up with an affordable payment plan which you may not have been able to. This could enable you to enter into an IVA. 

Some great independent debt charities that you can contact for debt advice include Stepchange and Payplan

If You Can’t Afford to Pay Off Debts at All 

If you have little to no money and can’t afford to make any payments at all towards your debt, then it’s definitely worth exploring debt management solutions that can help you write off debt. 

There are mainly two solutions you can consider if you want your debts written off. These are bankruptcy and a Debt Relief Order (DRO). 


Bankruptcy would involve most of your debt being written off. If you petition for your own bankruptcy, this is known as voluntary bankruptcy or ‘debtor’s petition’. 

Bankruptcy is usually opted for by individuals that can’t afford to pay back their debt within a reasonable time. 

It’s important to note that when you decide to go bankrupt, valuable assets of yours such as your car and/or your house are seized from you and sold off in order to pay for your debt

Thus, if your assets are worth more than the debts you have or if you can keep with regular monthly payments, then opting for bankruptcy would definitely be an extremely bad idea. 

You should only opt for bankruptcy when you have no other way of paying back your debt. 

It’s important to note that bankruptcy mostly takes care of unsecured debts. If you have other types of debt, you may have to look into whether or not they are covered by bankruptcy. 

Some examples of debt(s) that are not covered by bankruptcy include: 

  • Child maintenance fees
  • Criminal fines
  • Mortgage payments
  • Social fund loans
  • Student loans 
  • Payments ordered by the court as a result of personal injury or death of another person
  • Payments ordered by the court as a result of family proceedings

If you only have these types of debt, then bankruptcy will be pointless for you. In a case such as this, you should look towards other debt management solutions that cover these types of debt. 

You can also get advice from a debt charity about what the best course of action should be. 

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Debt Relief Order (DRO) 

A DRO is a debt management solution that is intended for individuals with very low income and little to no assets to their name. 

It’s meant to help these individuals get out of their debt and start again with a clean slate. 

When you opt for a DRO, all of your payments to your creditors get frozen. Your creditors also freeze interest and charges on your payments. 

These payments remain frozen for a period of 12 months, known as the moratorium period. 

Once this period is over, your financial circumstances are reassessed. If it is determined that you are still unable to pay back your debt, then your debt gets written off. 

On the other hand, if it is determined that your financial circumstances have improved, then you will not have your debts written off. In fact, you will be obligated to set up a payment plan to repay your debt.

A DRO allows you to write off debt but only if you truly don’t have the means to pay it off. 

In order to qualify for a DRO, you must not have a disposable income that exceeds £50. Furthermore, you must also not have assets that total up to more than £1,000. 


There are a number of ways to write off your debt but it’s important to take a step back and assess whether that would really be the best option for you or not. 

While you will certainly write off debt that you had, there are other pitfalls that come with such solutions which you need to be aware of. 

About the author

Scott Nelson

Scott Nelson is a financial services expert, with over 10 years’ experience in the industry, including 6 years in FCA regulated companies. Read more
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