Debt & Mental Health
People in debt are often identified as suffering depression, anxiety and stress. If your feelings are getting out of control, you should firstly get help from an NHS professional. Your General Practitioner and other NHS health professionals offer the best free advice . The mental health charity MIND state that:
“Approximately 1 in 4 people in the UK will experience a mental health problem each year”.
“In England, 1 in 6 people report experiencing a common mental health problem (such as anxiety and depression) in any given week”.
“The overall number of people with mental health problems has not changed significantly in recent years, but worries about things like money, jobs and benefits can make it harder for people to cope”.
“It appears that how people cope with mental health problems is getting worse as the number of people who self-harm or have suicidal thoughts is increasing”.
Supporting you with your debt
If you are experiencing a mental health issue this does not automatically mean you cannot deal with your debts yourself, but it can make it more difficult and you may benefit from extra support. Mental Health UK advise that “Money issues are widespread with nearly 3 in 10 (27%) of people have struggled to pay bills or rent”. Mental Health UK estimates that four million people in the UK are at risk of mental health issues because they’re having financial difficulties.
It is better to speak to a debt specialist as soon as possible, but remember it is never too late to deal with your debt problems, no matter how impossible your situation seems. An experienced debt specialist will be able to discuss several options and ways in which you can deal with your debts. For example, this may be negotiating a repayment plan or a more formal way of clearing your debts. If you choose to disclose your mental health issues, you will be treated fairly, sensitively and the details you provide will be treated confidentially.
Dealing with creditors
If you feel confident enough, you may want to contact your creditors , explaining that you are experiencing mental health issues, this may help with your negotiations and depending on the particular debt issue you may be offered breathing space whilst you seek specialist advice.
Creditors & the law
Debt & Mental Health Evidence Form (DMHEF)
Mental Health & Debt write-off
Every Mind Matters
Codes of practice
Creditors are obliged to follow certain rules and guidance, this varies depending on the types of debt you have.
Financial Conduct Authority (FCA)
The FCA regulate debt such as credit cards and loans. The FCA’s Consumer Credit sourcebook (CONC) (rules and guidelines) state a lender must have clear policies in place for customers who are in arrears and particularly vulnerable. This includes customers who have ‘mental health difficulties’.
The Standards of Lending Practice: Personal Customers (loans, credit cards etc.)
These standards state that ‘customers who are in financial difficulty and considered vulnerable should be dealt with positively and sympathetically’.
The Taking Control of Goods: National Standards
This gives guidance on good practice for bailiffs (also known as enforcement agents) - Vulnerability should be considered by both the bailiff and the creditor before referring the case to a bailiff, each situation should be assessed on a case by case basis.
You may owe money to HM Revenue and Customs (HMRC) for example income tax or tax credits. HMRC’s internal guidance states they should make reasonable adjustments for a person with mental health issues which have a substantial and long-term adverse effect on their ability to carry out normal day-to-day activities.