The song says that ‘money makes the world go round’. For many of us trying to keep up with everyone else is expensive and very soon can lead to being in debt which quickly spirals out of control. If you find yourself in this situation what should you do?

The first thing you must do is talk to someone.
Being in debt will not go away on its own and you will need help.

There are lots of organisations who are able to provide support and advice. We realise that it will be hard to pick up the phone or make a meeting with someone you don’t know to discuss such a difficult issue - but to get things sorted it really is the only thing to do.

So before you make that first step let’s talk facts.
There are two types of debt these are priority and non – priority debt.

Priority debt
This is the most serious form of debt as it can result in you:

• losing your home
• having one or more of your utilities being cut off (gas, electricity, water)
• going to prison (television licence and council tax).

In addition to these, other types of priority debt include:

• Rent arrears
• Mortgage arrears
• Arrears on any loans secured on your home. If a loan is secured on your home this will have been made clear to you when you took the loan out and will only apply to home owners.
  

Non-priority debt
The following are examples of non-priority debt.

• Credit cards
• Overdrafts
• Catalogues
• Hire Purchase Agreements
• General consumer loans (not secured on your property)
• Mobile/land-line phone bills

Although you can not be imprisoned for any of these, you will find your credit rating will be affected and these sorts of organisations are the ones who will harass you the most for their payments.

What to do if you find yourself in debt

• Don’t ignore it!
• Be honest with your creditors and keep them informed of your situation
• Be realistic about what you can afford to pay
• Don’t be intimidated by creditors
• Do not be drawn into using a consolidations loan company- they exist to make money from your misfortune
• Act before the debt collectors arrive at your door.
• Do not let debt collectors in. Only licensed bailiffs with a court order are allowed to enter your home. If in doubt only let them in if they are accompanied by the police.

Talk to a specialised organisation that provides a free service and let them negotiate on your behalf.
View our list of recommended organisations