Repaying Priority Items
If you are in arrears with priority creditors and
you cannot clear them by large payments, one of the first things
to do is to set a repayment based upon current repayment, plus
a sum for arrears.
Rent and Mortgage
The current weekly or monthly sum must be paid
regularly, and you need to add a sum to clear the arrears by
installments.
The amount that you need to pay will vary according to different
factors (including how much the arrears are, what other priorities
need to be met and how much you can pay without missing those priorities).
The key is regular payment. This will gradually reduce the debt
and will also show that you are committed to clearing the arrears.
If you are a tenant on income support/ income-based jobseeker's
allowance it may be possible for the landlord to obtain payment
of arrears at a fixed rate direct from your benefit. At present
this is £2.75 weekly.
Council Tax
You need to pay the current tax by installments
in order to clear it by the end of the financial year.
If you have arrears from previous years, an offer of a smaller
additional payment needs to be made in order to clear these.
If
you cannot pay as above, you may need further advice. If you are in receipt of income support/ income-based jobseeker's
allowance the local authority may apply for payment of arrears
at a fixed rate direct from your benefit. At present this is £2.75
weekly.
Gas and Electricity
The fuel supplier may set a rate of weekly or
monthly repayments to cover current consumption and arrears,
or may insist upon the
installation of pre-payment meters to do the same job.
If you are on income support/ income-based jobseeker's allowance,
payments of current fuel usage plus a fixed sum for arrears may
be taken direct from your benefit. At present the sum for arrears
is set at £2.75 for each debt with a weekly maximum of £5.50.
If disconnection of your fuel supply is threatened, contact the
supplier at once and discuss sensible repayments; if you cannot
reach an agreement, seek further help.
Magistrates' Court Fines
If you cannot afford the payment of a fine,
you must contact the court with details of your income and expenditure
and a new repayment
offer. You may be required to attend a hearing so that the court
can hear details of your financial situation and set a new rate
of payment (see later).
Maintenance Arrears/CSA
Once again, the principle
applies that current payments should be met, plus an offer to repay
arrears by installments.
If the maintenance is payable via a court, that court's enforcement
procedures will apply.
The CSA are usually willing to negotiate repayments of arrears
but will require payment of the current maintenance assessment.
Hire Purchase/Conditional Sale
To keep possession
of goods on HP or conditional sale, you must usually offer the
current payment plus a payment off the arrears
that will clear them within the lifetime of the agreement.
If this is not possible, you will need further advice.
You may NOT sell an item on HP or conditional sale in order to
clear debts unless you have the specific permission of the lender
- to do so without permission is theft!
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