Types of debt
Debt is generally broken down in to 2 categories, either priority or non-priority debt:
- priority debt is money owed for mortgage or rent, Council Tax, TV licence and utility bills
- non-priority debt is money owed for products such as catalogues, credit cards or unsecured loans
Debt solutions differ depending on whether you owe priority debt, non-priority debt, or a combination of the 2. It's important when seeking debt advice to be open and honest with the debt advisor about how much you owe and to which organisations.
Debt solutions
There are a range of debt solutions available, all depend on how much and who you owe the money to. A debt advisor will be able to advise which debt solutions are appropriate for your situation.
This list of potential debt solutions may be applicable to your situation:
- Debt Relief Order
- Bankruptcy Order
- Individual Voluntary Arrangement
- Breathing Space
This is not an exhaustive list and different situations will have different solutions.
Free debt advice
Many organisations offer debt advice for free. These include:
Some online or high street organisations charge for debt advice, and may suggest solutions that aren't the best for you. You can search for free, online debt advice that meets the standards of the Money and Pensions Service.
Cost of living and income maximisation
Cost of living pressures may be making it hard for you to meet your costs and getting into debt. There could be income that you're entitled to but not currently receiving.
As well as seeking debt advice, try putting your details through a benefit checker to ensure you're receiving everything you're entitled to and maximising your income.
We also have further information around the cost-of-living pressures in our cost of living hub including mental health support, energy advice and free school meals information.
Start your debt free journey
Although it may be easy to bury your head in the sand, we encourage residents to start their debt free journey by contacting one of the organisations listed. Seeking help and being in more control of your debts can help you to feel less stressed and worried.
When to seek emergency help
If you've received a notice of eviction from your housing provider or a notice of summons in regard to Council Tax, it's really important to seek help immediately. This may be from the organisation who has issued the notice or from the free debt organisations listed.