What Are Priority and Non-Priority Debts?

When money is short, deciding who to pay first can be confusing.

A priority debt is not necessarily the largest debt or the one with the highest interest rate. It is a debt where the consequences of not dealing with it can be particularly serious.

What are common priority debts?

Examples can include rent or mortgage arrears, Council Tax or Rates, gas and electricity arrears, court fines, child maintenance, some tax debts and certain money owed to government departments.

Some hire-purchase or secured agreements can also be priorities where an essential item or your home is at risk.

What are non-priority debts?

Common examples include credit cards, unsecured personal loans, overdrafts, catalogues and store cards.

These creditors still have legal rights and the debts should not simply be ignored, but the immediate consequences of missing payment are usually different.

Why does the order matter?

If you have £100 available, using all of it on a credit card because that company is calling every day may leave nothing for a rent or Council Tax problem with more serious consequences.

Looking at consequences first helps you use limited money more safely.

Does ‘priority’ mean I must pay it in full immediately?

No. If you cannot afford the required payment, contact the organisation and explain the difficulty.

Free debt advice can help you work out an affordable approach and understand any deadlines or enforcement action.

Get advice if the position is complicated

Some debts do not fit neatly into a simple list. For example, whether finance on a vehicle is a priority may depend on the agreement and how essential the vehicle is.

Use a free debt adviser to look at your actual circumstances rather than relying on a generic ranking.

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Important information

This guide provides general information and is not intended to provide financial, benefits, debt, housing or legal advice. Individual circumstances can be different. Check current information from official sources and seek advice from an appropriately qualified or authorised adviser before making important financial decisions.