If you know you could write off credit card debt and loan debt would you? A lot of people wouldn’t. Many people see it as unethical to wipe off debts they have incurred from over spending and believe they should pay back what they owe, which in some senses the correct thing to do. We have all overspent at some point in our lives on useless things we don’t need, especially over the last few years in the build up to the recession where you couldn’t walk past a bank or building society without them trying to drag you in and lend you some money.

I suppose it all depends on perspective and how we view the people that lend us the money… i.e. the banks and loan companies. But first we still need to answer the question; Can you actually write off credit card debt?... Well the answer is yes, and unsecured loans too. You are now asking ‘how can this be possible?’ We’ll come to that in a minute. First let’s take a look at how ethical the lenders are first.

How ethical are the banks?
Well now lets see… You only have to turn on the television to hear about another bank being bailed out with tax payers money while BILLIONS are still being paid out in bonuses to high flying directors while people are losing their homes. The greed of the banks started the recession and it’s the taxpayer who has to pick up the pieces as usual. The recession may be officially over but Britain still owes over £1trillion and it’s not going to be repaid over night, which means the cost of living will rise over the next few years and our grandchildren will inevitably take some of the burden. And it’s all down to the greed of the banks…

Bank charges
What happens at the end of the month when you go a few pence overdrawn because you spent all your money on your essential bills? You get charged… What happens when you think you have saved some money by doing a 0% balance transfer, only to find you didn’t read the small print and notice that the bank pays off the existing debt on the card before the transferred balance locking in interest… You get charged… What happens when we fall ill, are unable to work and try to claim on our PPI (Payment Protection Insurance) they tell you… sorry computer says NO!

So we have to ask so they actually have a positive effect on our economy? I’ll let you make up your own mind. So how do you feel now about writing off debt?... Well if you want to know how it can be done here’s how you can do it.

How to Legally Write Off Credit Card and Loan Debts
Back in 2006, section 27 of the Consumer Credit Act (which governs lending under £25,000) was removed. This section was specifically designed to protect consumer from lenders who supply loans and credit cards without the correct documentation. The act was replaced in April 2007 but the procedure opened the flood gates for credit agreements to be challenged for enforceability. If the debt is found to be unenforceable, the debt can be completely written off.

The easiest way to prove the unenforceability of a credit agreement is to write to your lender and ask them for a signed copy of your agreement. If they fail to provide this they cannot prove that the debt even legally existed. This is not as simple as it sounds as most lenders will defend any challenge to submit information to you so you have to use the proper legal channels in order to succeed.

How to request a copy of your credit agreement
Initially you have to send them what’s called a ‘Consumer Credit Agreement Request’ under Section 77 or 78 of the Consumer Credit Act with a standard fee of £1 payable to the creditor. This is a standard practice. Along with this you should send a ‘Subject Access Request’, which entitles you to view any documentation and information they hold about you on their records under the Data Protection Act 1988. This will cost you a further £10, again, a standard practice. They are legally obliged to respond within 12 days for the ‘Consumer Credit Agreement Request’ and 28 days to the ‘Subject Access Request’, totaling 40 days.

More often than not, if they cannot find a signed copy of your agreement (Which a vast amount cannot due to system and legal changes) they will write to you offering to clear the balance under their obligation to the Consumer Credit Act. Winner! You walk away debt free…

What if they provide a signed copy of my agreement?
In some circumstances they will be able to provide a signed copy of your agreement which is where you ideally need to hand the case over to a professional debt solicitor who can go through the agreement with a fine toothcomb and challenge it for a lack of ‘prescribed terms’. Without specific prescribed terms the contract could be deemed unenforceable and the debt could be wiped off.

By David Baddeley



Remember due to the re-amendments to the Consumer Credit Act you can only write off debt before 2007. Only contracts taken out before this date can be challenged. If you would like more information on how to write off debt visit our website; http://www.writeoffloan.com