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Priority and non priority debts

Priority debts include rent or mortgage arrears, gas and electricity debts, council tax arrears, county court judgments (CCJs) and fines imposed by the Magistrates Court . Debts to the University may be priority debts if they stop you progressing on your course. Priority debts should be paid before other debts.

If you think you have priority debts contact the Student Advice Centre

Non-priority debts include credit card and store card debts, overdrafts and most other credit debts. These should be paid when priority debts are dealt with.

 

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What can happen if I do not pay my debts?

Ignoring any debt can result in the debt increasing as interest and charges are added. Your creditors can also take you to court. If a CCJ is made against you, you will have trouble getting credit in the future.

If your creditors are taking court action, it is not too late to negotiate. Get advice.

Not paying priority debts can result in losing services like gas and electricity, facing eviction proceedings from your home, or being imprisoned for non-payment of council tax or fines. If you owe money to the University you may be asked to leave your course.

If this is happening to you, get advice.

 

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Tips for dealing with debts:

If you have one or two non-priority debts, you may be able to follow these steps yourself. If you have multiple debts and/or priority debts contact the Student Advice Centre

• Stop using the source of credit.

• Keep in touch with creditors and keep them up-to-date with your circumstances.

• Make sure you are liable for the debt. Is your name on the bill, or credit agreement? If in doubt, check with a Guidance Worker.

• Check that you are getting as much income as you are entitled to. Are you receiving the full amount of student support you are eligible for? Can you extend your overdraft or look for a part-time job? If you are a parent or have a disability you may be entitled to welfare benefits. You can check this with a Guidance Worker.

• Use a budget planner (available from the Student Advice Centre) to list your income and expenditure. Make sure you include essentials like paying rent, bills, and buying food. See if there are areas where you can cut back. Any money left over can be used to pay to creditors.

• Contact creditors and make them an offer. Do not enter into agreements you cannot afford. This will leave you without enough money for basic living costs. Ask creditors to freeze interest on your account. If your offer is refused, make the payment anyway. If creditors are difficult to negotiate with, the Student Advice Centre can help.

 

It may be easier to manage small, regular payments to creditors. This means you will have to plan your expenditure and stick to a budget, which can help prevent you getting further into debt.

 

Visit out budgeting pages or download out Budgeting Planner

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Debt self help pack:

This pack will guide you through the steps you need to take to negotiate with your creditors successfully confi dently; we’ll give you all the tools and the lingo to need! Before you do anything I would suggest you take a look at the glossary to familarise yourself with words and phrases you may hear from creditors and on these pages.

Please download all the parts of the pack from the following links:

Debt pack (PDF format)

Letter to Creditors

Second letter to creditors

List of Creditors

Financial Statement (Excel format)

 

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Please be aware that we are only able to advise current or prospective students of Leeds University.

These pages are for guidance only and are not a substitute for the diverse legislation they cover. The information was checked and correct at the time of writing.

If you have any comments or queries about this page please email advice@luu.leeds.ac.uk.

© LUU Student Advice Centre June 2006.