كتاب المساقاة
22  
The Book of Musaqah
(4)
Chapter: It is recommended to waive debts
(4)
باب اسْتِحْبَابِ الْوَضْعِ مِنَ الدَّيْنِ
Sahih Muslim 1556 a

Abu Sa'id al-Khudri (Allah be pleeased with him) reported that in the time of Allah's Messenger (ﷺ) a man suffered loss in fruits he had bought and his debt increased; so Allah's Messenger (ﷺ) told (the people) to give him charity and they gave him charity, but that was not enough to pay the debt in full, whereupon Allah's Messenger (ﷺ) said to his creditors:

" Take what you find, you will have nothing but alms.
حَدَّثَنَا قُتَيْبَةُ بْنُ سَعِيدٍ، حَدَّثَنَا لَيْثٌ، عَنْ بُكَيْرٍ، عَنْ عِيَاضِ بْنِ عَبْدِ اللَّهِ، عَنْ أَبِي، سَعِيدٍ الْخُدْرِيِّ قَالَ أُصِيبَ رَجُلٌ فِي عَهْدِ رَسُولِ اللَّهِ صلى الله عليه وسلم فِي ثِمَارٍ ابْتَاعَهَا فَكَثُرَ دَيْنُهُ فَقَالَ رَسُولُ اللَّهِ صلى الله عليه وسلم ‏"‏ تَصَدَّقُوا عَلَيْهِ ‏"‏ ‏.‏ فَتَصَدَّقَ النَّاسُ عَلَيْهِ فَلَمْ يَبْلُغْ ذَلِكَ وَفَاءَ دَيْنِهِ فَقَالَ رَسُولُ اللَّهِ صلى الله عليه وسلم لِغُرَمَائِهِ ‏"‏ خُذُوا مَا وَجَدْتُمْ وَلَيْسَ لَكُمْ إِلاَّ ذَلِكَ ‏"‏ ‏.‏
Reference : Sahih Muslim 1556a
In-book reference : Book 22, Hadith 20
USC-MSA web (English) reference : Book 10, Hadith 3777
  (deprecated numbering scheme)