Debt
Priority Creditors
Some debts are more important than others because of the serious risk of losing your house, possessions, fuel supply or, in extreme cases, the risk of imprisonment. It is not the size of the debt that makes it a priority but what the creditors can do to recover their money.
Priority debts are:
- mortgage
- rent
- second mortgage / secured loan
- council tax
- fuel (gas/electricity)
- income tax and national insurance contributions
- maintenance
- magistrate court fines
- hire purchase for essential goods i.e. if you need your car to get to work
Non-priority debts
- credit cards and store cards
- bank loans and overdrafts
- benefit overpayments
- hire purchase for non-essentials goods i.e. a TV
- money borrowed from friends and family