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Priority Debt


Valuable Information for those in debt

When an individual falls into debt, it is best to stay in touch with creditors and advise them of any financial difficulties immediately. If they do not have this information they may start pressuring the individual to take action with regard to the debt.

We recommend that in any debt situation, the individual contacts a specialist agency. It can be a complex issue. See links for organisations that can help.

Creditors should be informed that an agency's advice is being sought, particularly if the individual has to wait for an appointment at the agency. Creditors generally welcome the involvement of a specialist agency and the individual will find it much easier to reach agreement with this advice behind them.

Steps to be Taken by the Individual in Debt

  • Do not ignore the debt.
  • The individual should work out their income and expenditure. The budget should show if the individual has any leftover money which could be paid to creditors. It is also a useful exercise to identify areas in which money could be saved.
  • The individual should make a complete list of debts, working out which are priority debts and which are non-priority. Priority debts need to be paid first. If this means that non-priority debts have to be put on hold, this should be explained to the non-priority creditors.
  • The individual should contact their creditors as early as possible and explain the situation. We recommend that this is done in writing and a copy kept for reference.
  • Before using a debt management company, the individual is advised to contact a free specialist debt organisation.

You can download a budget (income and expenditure) form from National DebtLine or from Citizen's Advice Citizen's Advice - Debt and money

Negotiation with Creditors

The process of negotiation with creditors can be a lengthy and difficult one. Creditors will want to know the following:

  • What other debts the individual has and if this is the reason theirs cannot be paid (in the case of non-priority debts)
  • Whether the individual has any assets they can sell to cover the debt
  • Whether the individual has any available income
  • Whether the individual's situation is likely to improve or worsen
  • Whether the individual has a spouse or partner who could pay the debt

For further advice on bankruptcy, insolvency voluntary agreements, debt relief orders see Useful Links page.

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