surely not?????

[suagrtits]

can you just settle a debate for me please, im sat in my local with friends now and one has said that all debts, no matter how much you owe will be written off after 6 years. Also can people who have been declared bankrupt apply for credit after 6 years? surely not...... otherwise everyone would be borrowing left right and center with no intention to pay it back wouldnt they?

[sherrardk]

If you are declared (or declared) bankrupt you can apply for credit at anytime. In the first year of bankruptcy, you can only apply for a small amount (think it is up to £500 and you have to tell them that you're bankrupt). Anyone you try to get a loan or credit from will check your credit score anyway and as it will be bad you probably can't get any credit. After six years you are 'free' of your bankruptcy. Going bankrupt is hardly a barrel of laughs - if you have your own house you will probably lose it, etc.

[ubasses]

a debt becomes statute barred after six years is no action has been taken, but during that time you will have probably been taken to court, put into bankruptcy and have lost your home.

[Eve]

The 6 years they are probably referring to is the limitation period for issuing a money claim (not personal injury) in the County Court to get a judgment (and benefits of that eg securing on property and enforcement action).

In a simplified explanation, from my understanding this is only if the debt hasn't been chased though and people can't use the excuse of not receiving chasing letters if they have moved and not told the person chasing the debt.

Certain things will still show up on credit checks though so whether people with bad credit ratings will be able to get credit is another matter.

[suagrtits]

thanks for your replies, i wouldnt have thought it would be as simple to just refuse to pay back credit and get away with it, he's looking a little worried now. debate is well and truly over now haha

[bednobs]

DEBTS ARE NEVER WRITTEN OFF. after 6 years (longer for mortgage or benefit debts) of the lender not asking for it back it becomes statute barred. All thsat means is that it can't be chased through the courts. The money is still owed and they can still ask you for it.
Statute barred does not apply if you have moved without informing the lender.
It's incredibly unlikely that if you owed money, the creditor would not ask you for it back in asix year period. Also, as pointed out you will have been likely to have been taken to court in that time

[themas]

1. I've come across a lot of cases where debts are not chased for more than 6 years! They become statute barred if no payment has been made & the debt has not otherwise been acknowledged for 6 years (12 years for mortgage capital & some other debts). They can still be chased but - as already said - no Court action can be taken unless a County Court Judgement was obtained before the 6 years was up.

2. The point about notifying the creditor of address changes is valid, but my experience of the inefficiency of some creditors and debt collectors is such that it would not be at all surprising if such notifications were not properly processed when received.

3. Someone who is bankrupted has that fact entered on their credit record for 6 years. The entry then goes but in many cases they would still have difficulty getting credit because their credit record would show they had no credit - & creditors often dislike that nearly as much as they dilike a bad credit record.