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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