Debts

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It is very common for people to have debt and most of us will borrow money at some stage of our lives. Debt only becomes a problem if you are unable to pay back what you have borrowed but there is a great deal of support available to you if you find yourself in this position.

It can be tempting to ignore debts and hope they go away. Unfortunately they won’t, and the longer a debt is left, the worse it can get. It is very important to act if you receive any letters relating to debt, particularly if they refer to potential court action.

If you feel that you are struggling with your debts, finding it hard to pay your bills or would like to manage your finances better, you are not alone. Please don’t suffer in silence – seek help from any of the places in the Who can help? section below and you’ll find it far easier to get everything back on track.

 

  • What kinds of debt are there?
    Debts are usually broken down into two categories; priority debts and non-priority debts. We've listed some of the different debts but this won't cover everything.

    It is more important to pay priority debts than it is to pay non-priority debts. This is because the consequences of not paying a priority debt are far more serious. For example:

    • If you don't pay your rent you may lose your home
    • If you don't pay Magistrates' court fines, tax or council tax a bailiff could come into your home and take your goods, or you could go to prison
    • If you don't pay your utility bills, your gas and/or electricity could be cut off.
    Priority debts include:

    • Rent
    • Tax
    • Utility bills with your current supplier (gas, electricity etc)
    • Council tax
    • Magistrates' Court fines
    • Maintenance and child support payments
    • Essential items bought on hire purchase (such as a car to get to work
    Non-priority debts include:

    • Door step lenders
    • Credit and store cards
    • Money owed to catalogues
    • Bank overdrafts and loans
    • Money owed to a previous energy supplier
    • Money borrowed from friends or family
    • Non-essential goods bought on hire purchase
    • Arrears from a former tenancy

  • Who can help?
    Newcastle City Council has lots of information and guidance for those who find themselves in debt, all of which can be accessed here. They also have some very helpful advice around budgeting.

    There are a number of other agencies that can help you with your debts, for example the Money Advice Service and the Citizens Advice Bureau. They will help you tackle your debts and set up affordable repayments.

    You can also contact the National Debt Helpline free on 0808 808 4000 or the StepChange Debt Charity on 0800 138 1111.

    Talk About Debt is an independent debt help resource and community where people can share and talk about their debt problems.

    You can also talk to your advice and support worker about any concerns you may have around managing your debts and you should always let us know if you are struggling to pay your rent as we may be able to come to an arrangement with you.

    If you need to get credit then there are a number of options available to you but please be very cautious about how you borrow money as many options mean you pay back much more in the long run. We can provide information about the risks associated with borrowing money as well as a number of safer routes for doing so – please see details here.

  • I still have questions
    If you still have questions that we haven't answered here, please contact our Advice and Support team.

    The quickest way to get in touch with our Advice and Support team is to use our online referral form. If you want to speak to a member of staff, someone at your Housing Services Office can arrange this for you.

     

  • What should I do if I am not happy with the advice you have given me?
    We aim to provide you with good quality debt advice. If you are unhappy with the debt advice you have received from your Advice and Support Worker, please contact the Advice and Support Manager on 0191 277 1144 or suzanne.halliwell@yhn.org.uk to see if we can resolve your problem. If you are unhappy with the response you receive, please submit a formal complaint using our complaints procedure.

    Complaints to the Financial Ombudsman Service

    The debt advice we provide is covered by the Financial Ombudsman Service because we are regulated by the Financial Conduct Authority.

    If you are unhappy with our final response to your complaint or we have been investigating your complaint for eight weeks and have been unable to provide a final response, you can complain to the Financial Ombudsman Service. You should make your complaint to the Ombudsman within six months of our final response to you. The Financial Ombudsman may not be able to help you if you complain more than three years after our final response.

    The Financial Ombudsman’s service is free to consumers and depending on how complicated complaints are they can usually be resolved within a few months. Some complex cases can take a lot longer.

    The Financial Ombudsman Service is an alternative to a consumer taking legal action through the courts. They are less formal than a court. The Ombudsman won’t ask you to present your case in person. They usually sort things out over the phone and in writing. The Financial Ombudsman Service won’t usually look into an issue that has been to court already. Similarly, the Financial Ombudsman’s decision is legally binding so a court will not usually look at a case that has been deal with by the Ombudsman.

    Visit www.financial-ombudsman.org.uk to contact the Financial Ombudsman.

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