Step 4: Deal with the most important debts

After making sure you have as much money coming in as possible, reducing your spending and making a financial statement, the next step is prioritising your debts.

List any debts or credit agreements you have as priority or non-priority. Priority debts are the ones where there will be serious action if you don’t pay. For example your home being repossessed. These may include unpaid:

  • mortgage payments
  • rent
  • tax
  • utility bills
  • fines
  • hire purchase agreements.

Put them in order of importance so you can see what needs to be paid first. Once you have identified a priority debt, act immediately. Contact your creditors to tell them about your current financial situation.

If you can afford to make payments, try to agree on how much you can afford to pay and when. If you can’t afford to make payments, get advice from a debt adviser straight away. Organisations such as PayPlan, StepChange Debt Charity and Citizens Advice can help you negotiate with your creditors.

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List all your debts

It is important to keep track of your debts and to prioritise them depending on whether they are priority debts or non-priority debts. Priority debts are ones where there will be the most serious consequences if you don’t pay them back. Non-priority debts still need to be paid back, but the consequences of not paying them in time may be less serious.

You should aim to pay your priority debts first. You could start by writing down all your debts, then putting them in order of importance. This can help you see which priority debts should be paid first.

There is more information below to help you work out which debts are most important.

Identify priority (urgent) debts

Priority debts are the most important debts you need to pay. You should deal with these debts as soon as possible. Organisations including Advice NI, National Debtline, PayPlan and StepChange Debt Charity can help you discuss your priority debts with creditors. The following types of debt would be classed as priority debts.

Mortgage (secured loan) payments

If mortgage payments are not made for a few months, your mortgage provider may consider starting court action to take back (repossess) your home. It is important to talk to your lender if you are having difficulty with paying. There are schemes designed to help people pay the interest part of their mortgage. 

Unpaid rent (rent arrears)

You could be made to leave your flat (evicted) if you fall behind on your rent. If you are having trouble paying your rent or have made an application for Housing Benefit, it is important to make sure your landlord is aware of this.

Council tax in England and Wales

If you don’t pay your council tax, your local authority can look at sending bailiffs (enforcement agents) to your home. These agents can try to take (seize) your possessions. Your local authority could also take money from your income or benefits.

Council tax in Scotland

If you don’t pay your council tax, you could be taken to court. If you still don’t pay, they could take further action, including:

  • taking money from your income or benefits
  • sending sheriff officers to your home – these officers can try to take your possessions.

Rates in Northern Ireland

If you don’t pay your rates, you could be taken to court by the Land and Property Services. If you still don’t pay, they could take further action, including:

  • taking money from your wages
  • putting a charge against your property.

Unpaid gas or electric bills

Your gas or electricity, or both, may be disconnected if you don’t pay these debts. Explaining your circumstances to your energy supplier may stop this from happening. If you are classed as ‘vulnerable’ (for age, health, disability or severe financial insecurity reasons) and are unable to pay your bills, most of the major energy suppliers will not disconnect your supply. But you have to let them know that you are classed as ‘vulnerable’ to be placed on the Priority Services Register (PSR).

Fines, maintenance and compensation orders

If these are unpaid, a bailiff may be sent to try and take your possessions. You could also be sent to prison. In Scotland, these are enforced through the sheriff court.

TV licence

You may face a magistrates’ court or sheriff court fine for failing to pay this. See ‘Fines, maintenance and compensation orders’ information above.

Tax and VAT

If you don’t pay these, the government may recover the money you owe using commercial debt collectors or by taking your belongings (bailiff or sheriff officer action). They could also take you to court.

Hire purchase or conditional sale agreements

Hire purchase (or conditional sale agreement) is a type of borrowing that is often used to buy big items such as a car. Depending on how much you have paid back already, the company you are repaying may take back (repossess) these items. They may do this if you fall behind on payments.

Parking penalties

If you don’t pay these, civil action could be taken and your vehicle may be taken away. These penalties may sometimes be treated as priority debts. You should take advice on how to deal with these.

Other priority debts

You may also have other priority debts that are specific to your needs. You should be able to prove why you consider each debt a priority.

Contact your priority creditors

Once you have identified a priority debt, you should take immediate action:

  • Contact your priority creditors by phone to explain why you are in debt and agree what to do.
  • If you are still in the process of sorting out your finances, you could send a holding letter to your creditors. This is a letter to ask that no further action is taken until you have had a chance to sort out your finances. You can download a sample holding letter. However, you should try to make the regular payment in the meantime. If you can’t, pay as much as you can afford.

Although it may feel like a difficult thing to do, it is best to tell your creditors that you or the person you care for has been diagnosed with cancer. This should help them understand why you are having financial difficulties. They may be more likely to give you more time to repay your debt or offer you other solutions.

Many priority creditors will have a policy about giving people time if they contact them by phone. If you do contact any priority creditors, make sure you:

  • make a note of all phone calls and meetings, including the name of the person you spoke to and what you agreed
  • follow up the call with a letter, confirming what was said on the phone
  • keep copies of all letters you send to them.

If you can afford to make payments

If you have some disposable income, try to agree on how much to pay and when. You can do this yourself, or contact an organisation such as Advice NI, National Debtline, PayPlan or StepChange Debt Charity to help you.

If you can’t afford to make payments

If you have no disposable income and cannot afford to pay anything back to your priority creditor, get advice from one of the organisations above straight away. A debt adviser can help you to work out what is the best thing to do in your situation.

Ask the priority creditor to stop further action until you have been given advice. However, you should try to pay at least the regular instalment in the meantime. If you can’t do this, pay as much as you can afford.

After having treatment, money became tight. I had to cancel some direct debits and contacted creditors to explain my situation. They agreed to put me on minimum payment plans.


What to tell priority creditors

Most creditors should consider your offer for repayment, as long as it is reasonable. To show this, you should tell them:

  • how much disposable income you have (send a copy of the financial statement you created in step 3)
  • how many priority debts you have
  • whether your situation is likely to get better or not.

Next steps

  • Make a list of all your debts and see which debts you need to pay back first (priority debts).
  • Phone the priority creditors to explain your situation and ask for more time if needed (you can use our example of a holding letter).
  • If you can, agree a payment arrangement with your priority creditor.
  • If you can’t afford to pay your priority debts, contact Advice NI, National Debtline, PayPlan or StepChange Debt Charity straight away.

Back to Managing debt and borrowing

Debt and borrowing overview

Living with cancer can bring extra expenses. Learn how to manage your debts using a clear step-by-step process.

Step 1: increase your income

Increasing your income is the first step to managing your debts. Check your entitlement to benefits and insurance payouts.


If you can’t pay back your non-priority debts in a reasonable time, speak to a debt advice agency straight away.

Debts you leave behind

If you have debts when you die, it reduces the value of your estate. This means your beneficiaries will receive less money.