Dealing with your non-priority debts

Interest and charges

If you are trying to make an arrangement to repay an overdraft, you should ask the bank or building society to stop the charges and interest, so that the amount you pay reduces the debt. If the staff at your local branch are not able to agree to this, contact the regional or head office of the bank or building society and ask them to agree to do so. Point out that the Standards of Lending Practice - Personal Customers says banks “should demonstrate an empathetic approach to the customer’s situation…with a view to developing an affordable and appropriate solution.”

The Standards of Lending Practice - Personal Customers

The Standards of Lending Practice - Personal Customers sets out how banks, building societies and credit-card providers and their agents should treat you when you have financial difficulties. Under the standards, your lender should:

  • give you support and fair treatment;
  • not harass you or put you under undue pressure when discussing your problems;
  • show that they have an understanding and an awareness of your issues;
  • help you to develop an affordable and appropriate plan to manage your situation;
  • give you time to assess your options and refer you for free debt advice when it is clear that this would help you to sort things out; and
  • consider freezing or reducing interest and charges.

For more information, contact us for advice.

Voluntary charges on your home


before you agree to a voluntary charge

If you are asked to agree to a voluntary legal charge either by one of your creditors, or if your partner asks you to sign an agreement to a legal charge on your home, you must get legal advice first. Contact us for advice.

If you have a large overdraft or a personal or business loan, you may be asked to agree a voluntary legal charge on your home in return for reduced payments. This would mean that the debt would be secured on your home and you could then lose your home if you didn't keep up the payments. Banks will sometimes ask you to agree to a legal charge, which means any future borrowing or overdraft you have with the bank is also secured on your home.