When you have sorted out your priority debts, you should deal with non-priority debt. You should use any leftover money to make arrangements to deal with your non-priority debt.
Non-priority debts include:
- credit debts such as overdrafts, loans, hire purchase, credit card accounts, and catalogues
- water and sewage charges – you cannot be cut off for water debts
- student loans
- money borrowed from friends or family
You cannot be sent to prison for not paying non-priority debts. But if you don’t make any offers to pay without explaining why, your creditors may take you to court.
If you still fail to pay when the court has ordered it, your creditors can take further action. For example, they can get another court order which allows them to send bailiffs around to take your property away. This will be sold to cover your debts.
If you don’t make arrangements to pay off non-priority debts, your creditors may take you to court. You may not have much money left to pay these debts and can only offer a small amount towards your debt (such as £5 per month). This is called a token offer.
If you have no spare income to offer, consider asking the creditor to put a hold on any recovery action for a while in the hope that your financial situation may improve.
When writing to a creditor, you should also include a copy of your personal budget and provide details of your particular circumstances.
For templates to use when contacting creditors, see the National Debtline sample letter library.
Please seek further advice if you need help writing to your creditors or making an offer.
