Different types of debt

Gas and electric bills can get expensive, especially with the rising cost of living. But there are ways to manage your debt – for example, you can:

• speak with your energy supplier – they can check the charges are correct and help you work out a solution, such as a payment plan
• apply for support from the government or your local council – you may qualify for support that you aren’t currently claiming
• find ways to cut down your energy costs – lots of small changes can make a big difference
• apply for grants and funds from charities.

For more information, see our page Managing your energy bills.

Whether you’re renting or paying a mortgage, having arrears on your home can be worrying. If you’re struggling with housing costs, there are ways to get your debts under control.

For more information, see our pages Problems paying your mortgage and Problems paying your rent.

If you’re worried about being evicted or repossessed, there are organisations that can support you, such as Shelter. They can help you:

• understand your rights
• communicate with your mortgage lender or landlord
• put together a realistic budget to repay your debts.

You may be considering moving, or switching to a different type of housing – see our Housing options page to see what would suit you best.

You may end up in debt from overspending on goods and services. This could involve:

• credit cards – where you have access to loaned credit, which you then must pay back in the future
• overdrafts – where you are able to spend more money than is in your bank account, up to an agreed limit
• loans – examples of these include personal loans, payday loans and short-term loans
• Buy now pay later (BNPL) - this has become a very popular way for people to pay for items. This is an online payment option, which allows you to buy an item straight away and delay paying until a later date.

Visit National Debtline or StepChange for advice on how to manage your credit debt.

Debts to government departments or local councils can happen in a number of ways, such as:

• council tax arrears
• rates arrears
• TV license fines.

You may also owe money if you have been overpaid benefits or tax credit.

See StepChange for more information about government debts and ways to manage them. National Debtline and Tax Help for Older People can also offer free, expert advice.

If you're struggling to pay your water bills, talk to your water supplier as soon as possible. They can offer advice on how to cut down on your water costs and the best way to pay off any debt. Water suppliers can’t cut off your water supply, but can take court action to recover the debt if they don’t hear from you.

There are also other schemes and support services available if you’re on a low income or receive certain benefits. For more information, see our page Water – help with costs.

• Illegal money lenders – also known as loan sharks. If you have borrowed from a loan shark or want to report them, call the government’s confidential hotline.
• Owing money to friends, family, or other people.
• Court debts and fines.
• Joint debts – this could be with your partner, and could be left with you if they’ve died.
• Contract debts – this could be for your mobile phone, a gym or a TV package.

For more information about these types of debt, visit StepChange.