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Prioritising your debts

Some debts are more urgent than others, because they involve different risks. Various types of creditor have different rights under the law, so they can use different ways of getting their money back. If you don't act quickly some creditors could:

  • take away your home (repossession).
  • cut off your gas or electricity (disconnection). Note that your water company cannot disconnect your water supply.
  • send the bailiffs to take furniture from your home (distraint).
  • ask the magistrates' court to send you to prison.

Don't worry - you will always be given warning, and provided you act quickly you should be able to stop these things happening.

The debts where these things could happen if you delay too long are:

These are all priority debts. It is important to use the balance of your weekly budget to make agreements to settle these debts first.

Compare the list above with the list of creditors you made. Are any of your debts priority debts? Which ones?

If you don't have any priority debts, you can go on to the section on Dealing with credit debts.

Creditors can take action on some priority debts without going to court first. For example, gas and electricity can disconnect you, and the HM Revenue & Customs can send bailiffs to recover unpaid VAT and income tax without a getting a court order first.

Your other priority creditors can take action against you only after court action.

The next sections will help you think about the commonest forms of priority debt (and perhaps the most urgent):

If you don't have any arrears on your rent or mortgage, you can go straight on to:

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