Receiving a late payment letter can be extremely worrying, but there is no need to panic. First, you need to understand which of your debts is most important and then start dealing with them or talk to a free and impartial debt advice company. Find out more below.
If you’re struggling with money, you can talk to someone today, online, by phone or face to face. We have specially trained advisers who can help you start sorting out your financial problems.
It’s important to know the difference between priority and non-priority debts.
Your priority debts aren’t necessarily the largest bills or the bills with the highest interest rate.
But if they’re not paid, you could end up:
Your priority debts, which you should pay first if you’re unable to meet all your bills and debt repayments are:
Your non-priority debts include:
If you receive a late payment letter the worst thing you can do is to ignore it.
This will only make the situation worse.
Ignoring late payment letters might:
Don’t panic if you receive a late payment letter – legal action should be a last resort for a company chasing your debt.
Use our Debt Health Check to develop a plan to help you tackle your debts, today!
However, this doesn’t mean that you can ignore the letter.
There are different types of late payment letters and each one must be accompanied by an information sheet from the Financial Conduct Authority (FCA) on what the late payment letter means and where to go for advice.
The types of letter you could receive are:
You should make it a priority to speak to the people you owe money to or get in touch with a free and impartial debt advice company who will help you.
The company or companies you owe money to might offer to:
Most creditors will be reasonable if you explain your situation to them.
But they can’t help you if they don’t know you’re having problems.
There are tips on how to approach creditors in our guide below.
You need to work out your incomings and outgoings to see how much you can set aside each month to pay your debts.
You can work out how much money you have left over each month with our Budget planner below – or get help from a free debt advice service (see the later section ‘Get free and impartial debt advice if you’re struggling’).
If you think that there is a mistake or you don’t actually owe the money, don’t delay.
Contact the company immediately to avoid follow-up letters being generated.
If you are struggling to repay the money you owe every month, talk to a free and impartial debt advice company.
They will talk you through your different options. Read our guide below to find out more.
There are clear rules from the Financial Conduct Authority about what a company or debt collection agency should not do when collecting a credit debt.
If a debt collector breaks FCA rules or harasses you, report them to your local Trading Standards or complain to the Financial Ombudsman Service.
This article is provided by the Money Advice Service.