What are priority and non-priority debts?

When you’re struggling to keep up with your bills and debt repayments, it may be tempting to pay the creditor that shouts loudest first. But it’s important to pay priority debts before non-priority debts.

Find out the difference between the two and what to do if you’ve got money worries.

What’s the difference between priority and non-priority debts?

Priority debts are the ones that could have the most serious consequences if you don’t pay them. The possible consequences of not paying priority debts include:

losing your home (repossession or eviction)
being visited by enforcement agents (bailiffs)
being forced onto energy prepayment meters
having your gas or electricity supply cut off
losing essential hire purchase belongings

The consequences of not paying non-priority debts are usually less serious. But creditors may still take action against you. Your debt could be passed to a debt collection agency and you could have a county court judgment made against you.

Use MoneyHelper's bill prioritiser to find out what to do if you're struggling with bills from council tax to court fines and which ones to tackle first.

Which debts are priority debts?

Priority debts include:

rent
mortgage payments
overpaid benefits
loans that use your home as security
gas and electricity debts
council tax
court fines
hire purchase agreements for essential items (e.g. a car if there was no other way for you to get around, or an oven)
child maintenance payments (child support)
TV licence

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Which debts are non-priority debts?

Non-priority debts include

credit card debts
hire purchase agreements that aren’t for essential items (e.g. a TV)
loans that don’t use your home as security
water bills
money borrowed from friends and family

Being fair to your creditors

If you have numerous debts, any spare money you have after paying your priority debts must be shared out fairly between your other creditors. Not doing this might stop you entering a formal debt solution (e.g. a debt relief order or bankruptcy) further down the line. With this in mind, it’s a good idea to talk to a debt adviser before agreeing payment plans with individual creditors.