Where can I get help to sort out my debts?
Our freephone helpline can provide details of both national and local debt advice services. Depending on where you live, we may also be able to put you in touch with a specialist debt counselling service for families with disabled children. Remember you do not need to pay for debt advice and this can help you reduce the amount you are paying out each month.
I feel overwhelmed by debts. I just don’t know how to start sorting them out. What can I do?
There is a standard process for starting to sort out your debts. You will be able to get free confidential advice to help you through this process.
- It’s really important not to ignore your debts. Start by making a list of all your debts and your creditors – the people you owe money to.
- Check whether you owe the money and have to pay the debt.
- You will need to work out your income and expenditure – how much money you have coming in and how much you spend. Check if you can increase your income and cut your spending.
- When you’ve done a list of your income and expenditure, you will see how much money you have left to offer to your creditors. Then you need to identify your priority and non-priority debts to make realistic arrangements to pay.
I’ve heard about priority and non-priority debts. What’s the difference?
Some debts are more serious than others because of the consequences if you don’t pay them. Generally priority debts are more serious than non-priority debts. For example, mortgage arrears are a priority debt because you could lose your home.
You should not ignore any of your creditors, but when dealing with your debts make arrangements for your priority debts first.
- Examples of other priority debts include rent, council tax and TV licence payments.
- Examples of non-priority debts include credit card debts, bank overdrafts, catalogue debts and store cards.
Think about your personal situation too. For example, payments for a car are not considered priority debts. However, if you rely on it because you have a disabled child then you might want to treat it as a priority.
Problems with borrowing
If I am unable to receive credit from a bank or credit card company, what are my options?
- You may be tempted to try and borrow money by other means. We know from families that some borrow money just to get by, sometimes using quick cash schemes or loan sharks. Be aware that loans that are easy to acquire can be expensive to repay.
- If you’re thinking of borrowing money to clear other debts or meet your living costs, take free debt advice beforehand. There are many different types of loans and it is important to avoid loans you cannot afford to repay. Debt advice can help you make arrangements to avoid getting into more debt. You can also check to see if you’re getting all the benefits to which you are entitled.
I applied for a credit card and have been turned down but don’t know why.
- It may be because you have a low credit rating. To find out if this is the problem, ask the lender if they used a credit reference agency to decide whether to give you credit.
- Then ask for the details of the credit reference agency. There are three credit reference agencies. All the credit reference agencies keep information about you. A lender can consult one or more of them when making a decision.
- You can write to the credit reference agency to ask for a copy of your file. Alternatively, go to the credit reference agency’s website and ask to see the report online. There is usually a charge for this information, but it is normally a small amount.
- The information may be incorrect on file. If so, ask the credit reference agency to correct or remove the information.
- Increasing numbers of families with disabled children are falling behind with credit card payments. If this affects you, debt advice is available.
I feel that I am being harassed by my creditors. They keep calling me very late in the evening and it’s really difficult to get my daughter back to sleep. I’ve asked them to stop phoning me late at night.
- If you owe money, then creditors are entitled to make reasonable demands for repayment. However, there are certain things creditors should not do, including phoning you at unreasonable times.
- The Office of Fair Trading has produced guidance which describes practices that it considers unfair. It also has a leaflet that gives further advice. Been contacted by a debt collector? [PDF]
Help with utility bills
The Warm Home Discount scheme
This scheme may lead to a rebate worth up to £140. The scheme applies in England, Scotland and Wales only and is offered on a first-come-first-served basis. The discount is not paid to you – instead the £140 is deducted from your electricity bill.
You will qualify if your energy provider is part of the scheme and:
- you’re a pensioner who receives the guarantee credit of pension credit
- you fall into the ‘broader group’ of people that your energy supplier gives the discount to.
For you to be eligible to claim, you or your partner’s name must be on your energy bills and your supplier must take part in the scheme. The Gov.UK website lists all the firms that currently participate.
Do I fall into the broader group?
As a result of our Counting the Costs campaign, the government agreed to standardise eligibility criteria for a discount across all suppliers.
From winter 2015, the government has introduced new rules making clear who should qualify for a warm home discount under the ‘broader group’ of vulnerable customers. This includes:
- Parents who get either income support, income based job seekers allowance or income related employment and support allowance and who receive a disabled child premium in their award.
- Parents who either get income support, income based job seekers allowance or income related employment and support allowance and who receive a disabled child premium in their child tax credit award.
- Parents who don’t get one of the means-tested benefits mentioned above, but whose child tax credit award includes a disabled child element and whose tax credit award is based on an income for tax credits of £16,190 or less.
- Out of work parents on Universal Credit whose award includes a disabled child element and who are on an annual income of £16,190 or less.
The number of discounts each company gives to customers in the ‘broader group’ is usually limited, so discounts tend to be awarded on a first-come-first-served basis.
Who else might be eligible?
Other groups such as low income families with a child under five also qualify. Full details of the eligible groups can be found at table three on pages 28-29 of OFGEM’s guidance [PDF].
Suppliers also have the discretion to apply more generous rules offering discounts to other groups on a low income. Contact your supplier for more details.
To find out if your supplier is taking part in the scheme, visit the government’s Warm Homes Discount Scheme webpage.
Cold weather payments (UK-wide)
You may qualify for cold weather payments if you are on an income-related benefit, such as:
- Income Support
- Income-based Jobseeker’s Allowance (JSA)
- Income-related Employment and Support Allowance (ESA)
- Universal Credit
and you have any of the following:
- a child under five in your family
- a child for whom you get child tax credits or income support with an extra amount for their disability
or you receive:
- an extra amount for your own disability or for being over state pension age and you don’t live in a care home.
You will receive an automatic payment if the average temperature recorded or forecast over seven days in a row in your local area is zero degrees Celsius (freezing) or less. You do not have to do anything to receive the payment. You can use the government’s Cold Weather Payment tool to find out if your area is due to receive a payment.
Water Sure (England and Wales)
In England and Wales, help with water bills may be available under the Water Sure and Water Sure Wales schemes, which work in exactly the same way.
These schemes cap your water bill so you won’t pay more than the average metered bill for the area your water company covers. To qualify you must:
- be on certain benefits
- have a water meter (or be waiting for one to be installed)
- have a high essential use of water (this means you have three or more children under 19 in full-time education, or a child with a medical condition or disability that requires your household to use a lot of water).
Children who have certain conditions may automatically qualify under these schemes. Contact your water company directly to find out more and to apply. Your supplier may also offer additional help for customers struggling to pay their bills.
Help from water providers
Vulnerable customers who are finding it difficult to pay their water bills might be entitled to help from their water company.
In England, some providers offer social tariffs to households with low income or receiving certain benefits. Social tariffs are usually capped at a lower amount than normal bills. The Consumer Council for Water has details of water companies that offer social tariffs.
More help on reducing water bills
For more tips on reducing your water bill, visit the Consumer Council for Water page.
Other sources of financial help
Social services departments may help with problems related to fuel bills or fuel supply or provide financial assistance to help a child. This could be a cash payment, a loan or payment in kind.
Some charities provide grants for heating costs, expenses or arrears to families with a disabled child.
Check that you’re not missing out on benefits that are available. Check the turn2us calculator online.