The difference between priority and non-priority debts (and why it matters)

February 2026 PayPlan Blog #1

With so many types of debt, it can be hard to know which should be paid first. Understanding the difference between priority and non-priority debts helps you budget more effectively and stay in control of your money.

What are priority debts?

Priority debts are those that must be paid to avoid serious consequences – from losing access to essential services to facing legal action.

That’s why these debts are called priority debts – they should always be paid first over other debts.

What happens if I don’t pay priority debts?

The consequences depend on the type of debt and can include:

• Bailiff action – for example, if you don’t pay your council tax, gas and electricity bills.
• Disconnection of utilities – if gas or electricity bills remain unpaid.
• Losing your home – in the most serious cases, missed rent, mortgage or secured loan payments can result in eviction or repossession.
• Repossession of a vehicle on finance – if you fall into arrears.

What types of priority debts are there?

Common priority debts include:

• Mortgage or rent arrears
• Council tax arrears
• Gas and electricity arrears
• HMRC
• TV licence fines
• Court fines or child maintenance
• Hire Purchase (HP), Personal Contract Purchase (PCP) or Lease Agreement arrears

What are non-priority debts?

Non-priority debts are still important – but the consequences of missed payments are generally less severe. They don’t usually put your home or essential services at immediate risk.

What happens if I don’t pay non-priority debts? 

If you fall behind on these, you could face:

• County Court Judgments (CCJs) – creditors may take legal action to recover what you owe.
• Debt collection – your debt could be sold to another company that pursues repayment.
• Damage to your credit file – missed payments can lead to default notices and harm your credit rating.

What types of debt are non-priority?

Common non-priority debts include:

• Credit cards
• Personal loans
• Store cards or catalogue debts
• Overdrafts

What this means for your budget

When managing your household budget, always make sure priority debts are covered first – they carry the most serious consequences if left unpaid.

Once those are managed, focus on non-priority debts. Keeping up with minimum payments, where possible, can help prevent defaults while you explore longer-term solutions.

We’re here to help

If you are struggling with debts call us on 0800 072 1206. We’re open from 8am – 8pm Monday to Friday and 9am – 3pm on Saturdays.

Alternatively, you can visit our www.payplan.com/bfawu to speak to us via live chat or more information