Priority Debts

Priority debts are defined as debts that need to be prioritised as if they aren’t dealt with, they can cause serious problems. We advise working out what your priority debts are and ensuring you have all information regarding them to hand.

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Mortgage or Rent Arrears

If you don’t pay your rent or your mortgage you could risk losing your home or being evicted.

If you’re struggling to pay your mortgage, you can try talking to your mortgage provider to see if they can offer you a lower payment on your mortgage. You may also be able to switch to an interest-only mortgage until things improve.

Likewise, by speaking to your landlord or letting agent, you may be able to come to a more suitable arrangement.

However, please remember that companies aren’t obliged to reduce your payment amounts.

Service Charge or Ground Rent Arrears

If you own a leasehold property, you’re usually required to pay a service charge to cover the maintenance costs of the building you live in. You may also have to pay ground rent to the freeholder as part of your lease.

If you can’t pay your service charge, or you’ve fallen into arrears, you should contact the landlord or management company of your property to discuss your options for repaying the arrears. If you don’t take steps to deal with the arrears, the freeholder could take court action and you could lose your home.

Council Tax Arrears

If you miss a council tax payment, you fall into arrears – meaning you owe money to your local council. If you ignore Council Tax arrears, it’s likely your council will take you to court quickly to get all the money at once. You’ll have to pay court costs and possibly bailiff fees as well as your debt, which can add hundreds of pounds to your bill.

If you can’t pay your council tax, you can ask your council if they’ll let you pay your Council Tax in smaller amounts. You’ll probably be asked to commit to paying a regular amount each month.

If you’re on a low income or live alone, you may be entitled to a council tax reduction.

Electricity Bills

If you don’t pay your electricity bills, your supplier can collect the debt you owe using a debt collection agency. They can also get a court warrant to enter your home to fit a pre-payment card meter.

Any arrears will be added to the meter and a set amount will be deducted each week. This means you must pay the arrears at a set weekly amount or lose the supply. Your supplier can also remove the meter and cut off your supply, but this is rare.

If you’re struggling to pay, you can contact your supplier to discuss your options. You may also be eligible for or a grant from a charitable trust to help pay off your arrears.

Gas Bills

If you don’t pay your gas bills, your supplier can collect the debt you owe using a debt collection agency. They can also get a court warrant to enter your home to fit a pre-payment card meter.

Any arrears will be added to the meter and a set amount will be deducted each week. This means you must pay the arrears at a set weekly amount or lose the supply. Your supplier can also remove the meter and cut off your supply, but this is rare.

If you’re struggling to pay, you can contact your supplier to discuss your options. You may also be eligible for or a grant from a charitable trust to help pay off your arrears.

Water Bills

If you don’t pay your water bill you can fall into arrears. If this happens your water company can reminder notices, telephone you to ask for payment or pass your debt to a debt recovery agent.

As a last resort, the company can take you to court to get a county court judgment to recover the money you owe. You may then get a notice of enforcement from a firm of bailiffs telling you they are going to come round. If they come, they could take goods to sell to pay the money you owe.

If you can’t make a payment, you should contact your water company as you may be able to agree to a smaller payment amount.

Water companies can't, by law, disconnect or restrict your water supply if you owe them money.

Hire Purchase Goods

Hire purchase is a type of finance agreement used to buy motor vehicles and household goods such as furniture or appliances. Higher purchase is also known as conditional sale, and your agreement may use either term.

Hire purchase differs from other types of finance, because you don’t own the goods until the last payment has been made. If you miss payments, the hire purchase creditor can take the goods back.

If you miss payments to a higher purchase agreement, your creditor will contact you. They may let you repay the arrears over time, or extend the agreement.

County Court Judgements (CCJs)

You may get a county court judgment (CCJ) or high court judgment if someone takes court action against you (saying you owe them money) and you do not respond.

If you’ve received a County Court judgment and you don’t think you can pay it, there are different approaches you can take, depending on your situation. For example, you could set up a CCJ payment plan to pay it at a more affordable rate or you could apply to have the CCJ cancelled or ‘set aside’ if you think it should not have been issued.

If you don’t deal with your CCJ, your creditor can begin taking further enforcement action such as sending bailiffs to your home, applying for a charging order on your property or applying to have money taken directly from your wages.

Magistrate or Court Fines

Court fines for criminal offences are some of the most important debts to pay.

If you miss payment, courts have wide-ranging powers to collect fines. For example, a regular amount could be taken from your wage or benefits, bailiffs could be sent to your home, your fine could be added to a public register or in some cases, you could go to prison for non-payment.

If you can’t afford the fine you should contact the fines officer at the court and ask for a reduction in your payments. Make sure you do this this before you miss a payment as the court can take further steps to collect the fine if you miss payments.

Child Maintenance

If miss a child maintenance payment, you can be chased for unpaid child maintenance by your child’s other parent or by the Child Maintenance Service (CMS).

If you owe money directly to the child’s other parent, you can try and discuss your situation and come to an arrangement or repayment plan that works. If you can’t agree on a new arrangement, they could ask the CMS to collect maintenance instead. The CMS can’t make you pay any arrears under the arrangement you had with the other parent.

If you owe money to the CMS you should contact them immediately to organise a more affordable payment/repayment plan. If you are in arrears with the CMS, they can take enforcement action against you such as by collecting money from your wages, sending bailiffs or taking out court orders.