Write Off the Debt – Sample Letter Template Example

Are you trying to write a letter to your creditors to write off debt? We understand your worry. Debt can be a big problem, and it’s hard to know how to sort it out.

But you’re not alone. Every month, more than 170,000 people visit our website for help with debt problems. We know how to write a letter that might help your creditors understand your hardship and possibly write off some or all of your debt.

In this article, we’ll explain:

•  What does ‘write off debt’ mean.
•  How to ask your creditors to write off your debt.
•  Important tips for talking with your creditors.
•  What to do if you can’t afford to pay your debt.
•  About the law and debt.

We also have a letter template you can use. We hope this will make things easier for you.

Letter Template

To Whom It May Concern

Regarding Case #: [your case number]* (required)

I enclose a copy of my budget which gives details of my present financial circumstances.

As you can see, my outgoings are more than my income and I am experiencing extreme financial hardship.

I would be very grateful if you would consider writing off the outstanding debt owing. I have always taken my financial responsibilities very seriously but unfortunately, my circumstances are so bad that I cannot realistically maintain payments of any kind. Please take the following special information into account when making your decision.

[include a paragraph outlining the special circumstances you have that you want the creditor to take into account]* (required).

As you can see my situation is very unlikely to improve in the future and my continued high debt level may have a serious effect on my physical and mental wellbeing.

I would be grateful if you would seriously consider my request to write off the debt.

I look forward to hearing from you.

Yours sincerely

Downloadable Resource

The download links below take you to a Google document template where you can make a copy or save it in any document format you like. Note, you may have to log in to your Google account.

Tips on Negotiating with Creditors

A little-known fact about creditors is that they are often more than willing to negotiate, especially if you’ve proven you’re making a genuine effort to pay. Some things to keep in mind when contacting creditors you owe are:

• Always be open and honest about your situation
• Keep a calm and respectful tone
• Ask questions
• Make sure you fully understand what’s going on

What does it mean to write off debt?

Writing off debt is when a creditor decides they will no longer chase you for payment. It means you will no longer owe them any money. However, when a debt is written off, the fact it was wiped will still be present on your credit file for many years. This could stop you from getting loans, credit cards, mortgages, mobile contracts and even some bank accounts in the future. 

Thousands have already tackled their debt

Every day our partners, The Debt Advice Service, help people find out whether they can lower their repayments and finally tackle or write off some of their debt.

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Can I ask creditors to write off debt?

Anybody in debt can ask their creditors to write off their debt. Some creditors may not write your debt off in any circumstance, whereas others may consider writing off your debt if you can provide a legitimate reason why they should do so. For example, if you show that you have limited finances to pay the debt off and are unable to afford any type of repayment plan, they may feel there is no value in them chasing you for the money.

This is why we ask you to include a budget in our free wipe-off-the-debt letter template. Showing your finances will help you to prove you cannot pay the debt back and wiping it is a good idea. 

» TAKE ACTION NOW: Fill out the short debt form

Do creditors have to write off debt?

Even if you show that you have no capacity to pay back the debt, there is no law forcing a creditor to wipe off your debt. Some may agree to it and others may not. If they do not agree to it, you will have to find a way to deal with the debt, which might be getting the debt written off through a Debt Relief Order or Bankruptcy. 

However, there are some codes of practice on your side. The Lending Standards Board urge creditors to recognise financial difficulty that is unlikely to improve and wipe off the debt for these people. 

There are alternatives to debt write-off that you may want to consider such as:

• Debt management plans
• Individual Voluntary Arrangement (IVA)
• Debt relief orders (DRO)
• Bankruptcy

What is statute-barred debt?

Statute-barred debt is a type of debt that is too old to be collected. Many debts in the UK which are older than six years and have not been repaid in part during that time cannot be collected. This isn’t the same as wiping a debt. The debt still exists, but the creditor is not able to take you to court, thus, they can never force you to pay the debt back. 

If your debt is over six years old and you haven’t been paying it back, you should use our statute-barred letter template instead.