Is a debt written off after 6 years? You might have heard whispers that unsecured debt can be wiped if six years have passed since you owed the money. This might be true in some cases, but it might not be in others. Get a full explanation in our easy-to-read guide on wiping debt, here!

Is a Debt Written Off After 6 Years?

Due to a legal loophole technically known as Statute Barred, it is possible for your debt to be written off after six years (kind of!). It is not a rule that applies to everyone with personal debt because it is applied depending on a range of circumstances relating to the debt.

You must meet criteria to have your debt subject to Statute Barred, specifically:

  • Your debt must be at least six years old
  • Your debt must not have been paid in part over the previous six years
  • Your debt must not have been acknowledged in writing over the previous six years
  • Your debt must not have been issued with a CCJ asking you to pay

What Are the Debt Collection Laws Time Limit?

The rule of six years is crucial for your debt to be ‘wiped’. We’ll explain why we put the word wiped in quotation marks later in this guide.

The debt must be at least six years old, but you must have not made a payment (despite how little you paid) or acknowledged the debt over the last six years. If you did either of these things, the clock resets itself and you will have to wait for six years until you last made a payment or last acknowledged the debt.

Why Can Debt Be ‘Written Off’ After 6 Years?

You might be wondering why you get the chance to wipe some personal debts after six years. The reason comes from legislation that was designed to help the courts that were struggling with overwhelming numbers of debt cases and not enough resources.

As a way to prevent too many debt cases ending up in the courtroom, the law implemented a timeframe for debt to be collected. If a debt had not been successfully collected within six years – enough time for creditors to go to court and explore all their options – then the case would not be considered before a judge.

Essentially, the debt is banned from being discussed in court. And without a judge to issue a CCJ on the debt, it cannot be legally enforced.

So, Is the Debt Really Wiped?

Not exactly. Just because the debt cannot be legally enforced with the help of a CCJ, which forces debtors to pay, doesn’t exactly mean the debt is wiped. Instead, the debt simply cannot be collected and creditors and debt collection agencies cannot do anything to get the money from you, unless you obliged to pay. 

Can Debt Collection Agencies Keep Asking for Payment?

If your debt is classified as Statute Barred then you can inform your creditor or any other group chasing you for payment. There are pre-written letters you can find online (the best are on debt charity websites) and send to your creditors, which tells them the debt is Statute Barred and they have to stop contacting you.

Can I Just Avoid Creditors for 6 Years?

If all this is good news to your ears, you might be considering trying to avoid your creditors for six years or any time remaining before your debt becomes Statute Barred. This is not a good idea because creditors can take you to court if you fail to communicate with them and agree on a debt solution. If they then go to court and get a judge to issue a CCJ, the Statute Barred rule can never apply to the debt.

This means you could end up delaying having to agree on a debt solution or repayment plan and having to pay more. By trying to hide late fees and interest could make the debt much bigger and plummet you into more debt.

So, Is Statute Barred Even Realistic?

Six years to chase a debt is a very long time and creditors know about their deadline. Only a lucky few manage to go all the way to six years and not receive requests to pay or get taken to court. 

This usually happens because the creditor cannot find them anymore or because the debt is insignificant and going to court is not worth their time and money. 

Most people with personal debt will not get to use the Statute Barred loophole, but it doesn’t mean it is not possible. It is not recommended to call their bluff and believe they won’t take legal action, as they might and your debts could be much bigger.

What Can You Do Instead?

Instead of hiding from debt letters and sleepless nights worrying, it is usually best to respond to their requests for payment by looking for a debt solution. You might be able to agree on a monthly Debt Management Plan with creditors yourself, or you may even benefit from other debt solutions.

Another popular option for people with much bigger debts over £10,000 and a monthly income is to use an Individual Voluntary Arrangement. These are also monthly repayment schedules but have legal weight and wipe off up to 85% of personal debt.

It Has Nearly Been Six Years…

If you haven’t heard from your creditor for a long time and six years is nearly up, you might not want to look for a debt solution and instead try to stay under the radar until you qualify for Statute Barred. But this is a risk and may not work in your favour. 

For further help understanding Statute Barred debt, you can always call UK debt charities! 

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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