It might feel like every debt you owe is a priority because companies you owe money to will all chase you and expect payments. However, when you have unmanageable debt not all debts are equal in the way in which they can be collected and so it is important to know the difference between non-priority and a priority debts. You will no doubt find yourself juggling which ones to pay but you muct make sure that you pay certain debts above other.
As well as reading this page, Make sure that you refer to the following pages to get a good idea of what to pay first and what your creditors can and can't do:
What is a non-priority debt?
A non-priority debt is generally one belonging to a creditor that cannot take severe recovery action against you straight away. For example, an unsecured payday lender cannot repossess your home or have you imprisoned and your water supply cannot be cut off, wheras electricity and gas can be cut off.
It is important to know that most debts can become priorities if they are not dealt with for a long time but it usually takes a while for this to be the case, please take a look at the drop down 'When can non-priority debts turn priority?'
Most non-priority creditors will give you 'breathing space'
Common Non-priority Debts
The creditos shouting the loudest should not automatically become the most imprtant debt to pay, here is a list of common non-priority debts you might have:
- Bank loan
- Utility arrears from a former address, suvh as ekectric/gas
- Arrears from property reporssessed
- Payday loans
- Water Arrears
- Credit Cards
- Friends & Family
- Old mobile phone contracts
- TV Braodband debts not still being used
When can non-priority debts turn into a priority?
Eventually, any debt you have can end up as a priority debt, depending on what further steps your creditor takes, please visit our 'Enforcement of Debts' debt advice topic for more information. Below are some examples of non-priority debts changing to priority:
- Bank loan for £2000 - county court claim made > County Court Judgment > Defaulted Judgment (instalments agreed not paid) > Attachment of Earnings Order
- Any debt for £5000+ - a creditor can issue a Statutory Demand for Bankruptcy
- Water debt over £600 > county court claim made > County Court Judgment > Defaulted Judgment (instalments agreed not paid) > Writ of control issued > High Court Enforcement