Administration order
Also known as an 'admin order'. This is a type of payment plan that is taken care of by the County Court. It can make the amount you pay to your debts easier to afford. You can apply to have debts written off in some cases.
Annual Equivalent Rate (AER)
AER tells you what you would earn in interest on a savings account. It is shown as a percent (%). The amount of interest you earn is based on the amount of savings you have in your account.
Annual Percentage Rate (APR)
APR shows how much you will have to pay in interest on top of the amount you borrow. It is shown as a percent (%). You can use it to compare the true cost of credit. But you should not use it to compare different types of credit, like a mortgage with a credit card. They will have different terms.
Arrears
This means missed payments. If you miss one month's payment to a bill or debt, you will be in arrears by one month. It can also be written as a value. If you miss a payment of £100, you are in arrears of £100.
Arrestment
Scottish courts can use this to get the money you owe. They can 'freeze' your bank accounts, which means you cannot use them. Then they can take money from these bank accounts.
Arrestment of earnings
Scottish courts can use this to get the money you owe. Your employer takes money from your wage and pays it to the people you owe.
Asset
An asset is an item of value. Like a house, car or antique.
Attachment
A way for the courts to get money for an unpaid debt. Sheriff Officers can take goods from outside your home and sell them. They cannot take goods from inside your house. The money from those goods is paid to your debt.
Attachment of benefits order
A way for the courts to get the money you owe. The Department of Work and Pensions (DWP) take money from your benefits. This is then paid to the people you owe.
Attachment of earnings order
A way for the courts to get the money you owe. Your employer takes money from your wage and pays it to the people you owe.
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Bailiffs
These are officials who can take away the things you own. The people you owe can use them to get the money to pay off your debt. Bailiffs can only take things from your home that you do not need. They sell these items and the money goes to paying off your debt. Also known as Enforcement Officers.
Bankruptcy
This is a type of debt solution. The courts write off debts you would not be able to pay back. Any items of value you own will be sold to pay off your debt. Bankruptcy is a legal process and the people you owe have to agree to it, if it is approved.
Beneficiary
Someone who is going to get items of value (assets) or money from a trust, estate or insurance policy.
Bankruptcy restriction order (BRO)
A court order that means bankruptcy restrictions stay in place for 2 to 15 years. These are put in place when you break the rules of your bankruptcy.
Bankruptcy restriction undertaking (BRU)
Similar to a bankruptcy restriction order (BRU) but without the need for a court hearing. This is put in place when you break the rules of your bankruptcy. Bankruptcy restrictions stay in place for 2 to 15 years.
Balloon payment
A one time lump sum payment. These are normally made at the end of a hire purchase or conditional sale agreement.
Basic bank account
An account designed for people with poor credit scores. They are often used by people who have been insolvent. Most have a debit card, and some let you set up direct debits. These accounts do not let you be overdrawn.
Beneficial interest
A share in an asset, often property, which means you own part of it. This is usually shown as a percent (%). These shares can be sold to raise money to repay debts.
Benefit over-payment
This happens when Her Majesty's Revenue & Customs (HMRC) pay you more benefits than you should have. Any overpayment will need to be paid back to HMRC. Such as, if HMRC pays you £120 when they should have only paid £100, they will try to get £20 back from you.
Broker
A person or organisation who works to find you the best deal when you buy things like insurance, mortgages, stocks, or property.
Budget
A list of all the money you have coming in and out each month. The money you have coming in is called your income. The money you spend is called your expenditure.
Budget deficit
This is when you are spending more money than you have coming in each month,
Budget surplus
This is when you have money left over to spend after you have paid your bills and living costs.
Budgeting
A way to manage your income and spending. It can help you keep up with bills and living costs.
Budgeting loan
A loan from the Job Centre. It Is for people struggling with money and can be paid out to people who are working or claiming benefits.
Buildings insurance
Buildings insurance covers the cost of repairing or rebuilding a property if it gets damaged. The insurance may cover some or all of the cost.
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Capped rate
An interest rate or price that can vary, but has a fixed amount that it cannot go over. This applies to products like mortgages and energy bills.
Certificate of cancellation
A document you get from the court if you pay a county court judgment (CCJ) within one month. It cancels the CCJ.
Certificate of satisfaction
A document from the court that proves you have paid a court order, like a county court judgment (CCJ).
Charge for payment
A legal notice in Scotland. It orders you to pay all of a debt by a set time.
Charging order
This attaches an unsecured debt to a property or land. This makes the debt a secured debt. The people you owe can apply for this if you have a County Court judgment (CCJ). The money you get from selling the property or land would go toward paying off the debt.
Child benefit
A tax-free payment made to anyone who is responsible for a child or young person. It is paid regularly and usually lasts until the child is 19, as long as they are in full-time education or training.
Child tax credit
A means-tested benefit for people who are responsible for a child or young person. It is usually paid until the child is 19. 'Means-tested' means the amount you get depends on your income and circumstances.
Civil National Business Centre (CNBC)
The Civil National Business Centre (CNBC) deals with a range of civil claims. Their claims are issued by CNBC in the name of Northampton County Court.
Company pension
A pension plan where you and your employer make a monthly contribution. The amount you pay is tax free. Since October 2012 every employee is opted in to their employer's pension plan.
Collection order
A court order you may get if you have missed payments to a Magistrates court fine. It should include the amount of the fine, what the payment terms are, where to pay and how to contact the fines officer.
Collections process
The different stages a debt goes through when contractual payments are not made.
Compound interest
Compound interest builds year-on-year. Every time interest is added, the total becomes the new amount on which future interest is worked out.
Conditional sale agreement
A type of credit agreement where you do not own the goods until you have made all the payments in the agreement. Goods may be repossessed (taken away) if you miss payments.
Consolidation loan
Also known as debt consolidation. This is where you borrow money to pay off two or more loans. It means you can combine many loans into one loan. It tends to have lower monthly payments, but takes you longer to pay back. You could end up paying more in the long term.
Consumer Credit Act 1974 (CCA)
The law that personal loans and other credit agreements have to follow, like hire purchase and credit cards. It has rules that companies must follow when setting up credit and getting back what they are owed.
Continuous payment authority (CPA)
Also known as 'recurring payments'. The company will ask for the long number across your debit or credit card rather than your bank details. CPA is often used for things like payday loans or gym memberships.
Contents insurance
A type of insurance that covers the cost of repairing or replacing items you own if they are stolen, lost, or damaged. The insurance may cover some or all of the cost.
Contractual payment
The monthly amount you agreed to pay back towards a debt when you first signed the credit agreement. If you do not make the contractual payments, you will fall behind on payments. This is called arrears. It may affect your credit rating.
Council tax
A payment you make monthly to your local authority. It is used to cover domestic services.
County court
A civil court that is usually used to solve disputes between parties who cannot agree. Parties can mean people or businesses.
County court bailiffs
Civil servants who make sure county court orders are followed. This is also true for orders made at tribunals which have been moved over to the county court.
County court claim
A legal process the people you owe can use to collect an outstanding debt.
County Court judgment (CCJ)
A court order that tells you what to pay towards a debt.
Court action
The people you owe can take court action if you cannot come to an agreement to repay your debt. Court action could be sending bailiffs to your home or getting a county court judgment (CCJ).
Credit agreement
A legally binding contract between you and a lender. It shows the terms and conditions for lending money.
Credit card debt
This happens when you do not pay back what you spend on a credit card. Over time, the lender can add interest and charges to the debt. This means you end up paying back more than you borrowed.
Credit file
Also known as a credit report. This keeps track of what you have borrowed and the payments you have made or missed. It also has information about types of credit you have tried to get.
Credit rating
Also called a credit score. It is a rating that shows how likely you are to pay back money. It is one of the things lenders use to work out if they want to lend you money.
Credit reference agencies
Companies that keep credit file information on almost every adult in the UK. Lenders use this information to work out if they want to lend to you.
Credit searches
When a lender looks at a person's credit information to work out if they want to lend to you. It is done when you apply to borrow money.
Credit unions
Not-for-profit organisations that are owned by their members. They offer saving and loan services.
Creditor
The people you owe money to.
Crisis loan
A temporary loan issued by the Job Centre. It is for people in financial difficulties. It can be given to people who are working or claim benefits.
Critical illness cover
A type of insurance that pays out a lump-sum payment if you are diagnosed with a certain illness.
Culpable neglect
When spare money you have after paying bills and living costs is spent on things you do not need instead of making court-ordered payments.
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Debt
The money you owe.
Debt Arrangement Scheme (DAS)
A debt arrangement scheme is a scheme run by the Scottish Government to help people pay back what they owe through debt payment programmes (DPPs). You must live in Scotland to apply.
Debt collection agency (DCA)
Organisations that try to collect what you owe. The people you owe can ask them to get back money you owe to them. Or, DCAs can buy debts from other lenders.
Debt consolidation
Debt consolidation is where you borrow money to pay off two or more loans. It means you can combine many loans into one loan. It tends to have lower monthly payments, but takes you longer to pay back. You could end up paying more in the long term.
Debt management plan (DMP)
A DMP is a debt solution that you can get no matter where you live in the UK. It is a way of paying back what you owe if you cannot make the full regular payments (contractual payments). You make lower payments to the people you owe based on what you can afford. This means it can take longer to pay back what you owe.
Debt payment programme (DPP)
A formal debt solution available through the Debt Arrangement Scheme (DAS). It is a way to pay back what you owe without the threat of court action from the people you owe. It works in a similar way to a debt management plan (DMP) but offers more protections. You must live in Scotland to apply.
Debt relief order (DRO)
A way of writing off your debts if you cannot pay back what you owe. This means the debt is gone and you do not have to pay it back. A DRO is a form of insolvency and can only be used if you owe less than £50,000.
Debtor
This is someone who owes money.
Debtor contribution order (DCO)
An order that tells you how much your regular payments will be during bankruptcy in Scotland.
Decree
A judgment or order for not paying a debt. It is given by the Scottish courts.
Deduction from earnings
This is when money is taken out of your pay from work. The Child Support Agency (CSA) can take money from your wages if maintenance payments are not made.
Default
When you miss payments on a debt and cannot get up to date within 14 days, this is a default. It makes it harder to borrow more money as it stays on your credit file for six years.
Default notice
Something the people you owe send you when you miss a payment to a debt. It gives you 14 days to pay what you owe and get up to date with your payments.
Deficit budget
This is when you are spending more money than you have coming in each month,
Dependant
Someone who relies on another person financially, like a child.
Diligence
Another word for the powers the Scottish courts use to get a court order or decree paid. It is similar to enforcement in England and Wales.
Diligences
Enforcement powers given by the Scottish courts. It can be used against you when you miss payments or do not make any payments to a decree.
Direct Debit
An instruction you give your bank to pay a person or company each month. The amount paid through a Direct Debit can change.
Disassociation
When you ask a credit reference agency (CRA) to end a financial connection with someone. If you have a joint bank account with an ex-partner, you might make a disassociation request so they do not impact your credit file anymore.
Disbursement
Money paid out from a specific fund or source. Disbursement is usually done by a third party on behalf of someone else. For example, you make a DMP payment to StepChange and StepChange disburse the money to the people you owe for you.
Discharge
This means your bankruptcy ends. It happens when all the conditions have been settled and the debts have been written off.
Discount rate
An interest rate that is reduced for an amount of time before it goes back to the standard rate. Discount rates are often offered as a type of mortgage rate, or for energy bills.
Disposable income
The amount of money you have left to spend on non-essential items after you have paid your bills and living costs.
Doorstep collector
Someone who collects money for a collection agency by visiting people at their home.
Doorstep lender
Companies that offer small short-term loans to people on low incomes. Repayments are made weekly or fortnightly to collectors who visit your home.
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Early repayment charge
Also known as redemption penalties. A payment you make to a lender if you pay off the debt before the agreement has ended. Not all lenders have early repayment charges.
Early settlement
When you pay off some or all of the amount borrowed before the due date.
Earnings arrestment
When money is taken from your wage. This can happen if you miss payments to a decree from the Scottish courts.
Endowment
A type of life insurance policy that can be used as a way to repay a mortgage where only the interest has been repaid to the lender.
Enforcement
Ways creditors or courts get back money they are owed. This happens after the people you owe have gone to court over the debt. Enforcement actions include sending bailiffs to your home, charging orders, attachment of earnings and Third Party Debt Orders.
Enforcement agent
Another word for bailiffs. These are the people who can be sent to your home to take items to sell. Money made from sold items is used to help pay off your debt.
Enforcement of Judgment Office
The department responsible for collecting unpaid court debts in Northern Ireland.
Equity
The difference between the value of your home and the amount left to pay on your mortgage and any loans attached to your home. If your house is worth £100,000 and you have a mortgage for £40,000, you will have £60,000 in equity.
Equity release
When you take a lump-sum payment or steady stream of income out of the equity you have in your home or other property.
Estate
Anything you own is your estate. This includes your home, car, and personal belongings. It also includes any rights you have to get money or goods in the future.
Eviction
The legal process used to force you to leave your home. Bailiffs may change the locks to your home if you do not leave voluntarily.
Examination of means
An interview with the Enforcement of Judgements Office (EJO) in Northern Ireland. The EJO gets information about your finances and works out the best way to get back what you owe. The interview usually happens at court, but it can be done at your home or work. If you do not go to the hearing, the court can issue a warrant for your arrest.
Exceptional attachment
An order from the Scottish courts. This order lets them take goods from inside your home if they could not get enough money from you to cover the debt. There are things they cannot take. Usually they will only try to enter your home when someone is there. But if they have tried many times and no one has been home, they can get a special court order to force their way in.
Exempt goods
Items that cannot be taken to pay back a debt.
Expenditure
All the money you spend each month.
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Family or friend loan
Money owed to a friend or family member.
Final discharge
A court notice that shows your bankruptcy has ended. This document means you are debt free and the bankruptcy is over.
Final salary plans
A pension based on the number of years of service and the value of your final salary.
Financial Conduct Authority (FCA)
The group that regulates the finance sector. They regulate organisations like banks, credit card companies, debt advice providers and more.
Financial ombudsman
An independent body that helps fix disagreements between businesses and their customers. They only do this with businesses that offer financial services.
Financial statement
A list of your income and spending over a period of time, usually a month. It can show the people you owe how much you can afford to pay to your debts.
First right of appropriation
This gives you the right to tell your bank how you want money paid into your account to be used. It means you can make sure bills and living costs are paid before the bank take their charges. This includes charges for overdrafts. You can stop your bank freezing your account to pay back a debt you have with them.
Fixed rate
An interest rate that does not change for a set amount of time.
Forthwith judgment
A type of County Court judgment. It is a decision from the courts where they ask for the full amount of your debt straight away, or by a certain date.
Fuel Poverty
When poor housing conditions and low income mean that the household cannot afford necessary warmth for health and comfort. It is estimated that a household needs to spend 10% or more of their income to meet fuel costs.
Full and final settlement
A way of settling a debt, meaning it is paid off. You pay a large amount toward your debt, which can be less than the amount you have left to pay. If you and the people you owe agree on the amount, the debt is settled when the amount is paid. Settling a debt for less than what you owe will affect your credit file.
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Gross
The total amount before anything is taken off. Such as, a gross salary is the total amount of your salary before tax and National Insurance is taken off.
Guarantor
Someone who says they will pay a debt if the person who owns the debt does not. You might have a guarantor for a rental agreement. In this case, if you do not pay your rent, your guarantor would have to.
Guarantor loan
An unsecured loan where someone else is responsible for making the payments if the borrower cannot pay.
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Harassment
When someone you owe puts pressure on you to pay money you owe them. It usually involves threatening actions. The people you owe may get in touch with you over and over within a short amount of time, or act illegally. You can complain about harassment by debt collectors and bailiffs.
High Court
The regional court which deals with civil claims. These claims involve amounts of more than £50,000, and complex or important points of law.
High Court enforcement officer (HCEO)
A bailiff who carries out High Court decisions. There are not many HCEOs. Bailiffs who come to your house to collect payments are almost always private bailiffs. These are hired to act for the HCEO.
High Court judgment
A legal decision made by the High Court.
Hire purchase
A type of credit agreement that lets you possess and use goods. You do not own the goods until you have made all the payments set out in the agreement. The goods can be taken back by the lender if you miss payments.
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Independent financial adviser (IFA)
Someone who offers advice on financial products and investments. They are separate from any company providing the financial products.
Income
Any money you get from things like wages, pensions or benefits.
Income drawdown
A scheme where someone with a personal pension or stakeholder pension takes out money sometimes for income.
Income payments agreement (IPA)
An agreement with someone in bankruptcy. They agree to pay any money they have left over each month towards the bankruptcy for a short amount of time.
Income payments order (IPO)
A court order given to someone in bankruptcy. It makes the person pay any money they have left over each month towards the bankruptcy for a short amount of time.
Income protection
A type of insurance. It provides a steady monthly income to replace your wage if you are not able to work because of an accident or illness.
Income Support
A benefit for people who are on a low income. It is means-tested, which means it is worked out based on your situation.
Income tax
An amount you have to pay on what you earn, and any pensions or investments you have.
Individual voluntary arrangement (IVA)
A legally binding agreement between you and the people you owe. You pay back an agreed amount of your debts over a set period of time. This is usually five years. When the IVA finishes, the rest of your debts are written off. This means you do not have to pay them back.
Increasing term assurance
A type of life insurance. It pays out a lump sum if you die within the term. The amount paid out increases the longer the insurance runs for.
Inflation
The rate that prices for goods and services rise over time.
Inheritance tax
The amount your beneficiaries have to pay when you die. Beneficiaries are the people you choose to inherit your money or possessions when you die. The amount they have to pay depends on the amount of assets (items of value) you leave at the time of your death.
Inhibition
A Scottish court order. It stops someone selling something they own and not using the money from the sale to pay back what they owe. This is usually a property.
Insolvent
This means that a person or company cannot afford to pay back what they owe. It also means any items of value they own are worth less than the amount of money they owe.
Insolvency
A legal process to get your debts written off, which means you will not have to pay them back. Insolvency solutions are things like bankruptcy, protected trust deeds and debt relief orders.
Insolvency administration order
The people you owe can apply for an insolvency administration order within five years of a person dying. It allows the court to order the surviving owner to pay the value of the deceased person's equity into the estate.
Insolvency practitioner
A person who is legally able to act for people or businesses who cannot pay back what they owe.
Insurance
A contract between you and an insurance company or broker. You pay them an agreed amount and in return, they will replace or compensate you for any belongings that are stolen or destroyed. The contract sets out the situations where the company will replace or pay for your belongings, and which would be replaced.
Interest
A charge for borrowing money, or a reward for saving money.
Interest only mortgage
A type of mortgage where the money you borrow is paid back at the end of the term. This is usually comes from the money in an investment plan, like an endowment policy or individual savings account (ISA). In this type of mortgage, you only pay the interest on the mortgage. The balance stays the same.
Interest rate
An amount of money added to a debt or balance, like loans or savings. It is normally shown as a percent (%).
Interim charging order
A temporary charge on a property. It is used to cover the time between a charging order being applied for and the court hearing.
Irregular bill
A bill that you pay occasionally, rather than every month or every week.
Individual savings account (ISA)
A savings account where you do not have to pay tax on the money you save. You are only allowed to save a certain amount of money in the account.
IVA nominee
Someone chosen to look at an IVA proposal for someone who cannot pay back what they owe. This will normally be an Insolvency Practitioner.
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Joint and several liability
When two people get a credit agreement. Both people are responsible for paying back the whole debt. If one person pays back half of the debt, they are still jointly responsible for the other half.
Joint life second death policy
A type of life insurance that only pays out on the death of the second policy holder.
Judgment
A Northern Ireland court order issued for non-payment of credit debts. It is similar to a CCJ in England and Wales.
Judgment (in default)
When the court makes a decision without a hearing. This can happen if you do not respond to a County Court claim form in time, or if your response is not accepted.
Judgment debt
The amount of debt plus any fees the court says you have to pay.
Judgment forthwith
A court order to pay the whole judgment debt straight away.
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Key facts document
A document given to you by a provider of financial products. It will show you the costs and features of a certain financial product.
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Late fees
Money that can be added to your account if you make a payment late.
Letter of Authority (LoA)
Also known as a mandate of authority. A letter that lets a person or organisation do business on behalf of another person.
Level term assurance
A type of life insurance. If you die within the term, it pays out a lump sum of money. The amount you are paid stays the same throughout the whole term.
Levy
A power given to bailiffs that lets them take and sell goods. Not every person who comes to collect what you owe has this power.
Liability
When you are responsible for paying something. Like paying back a loan, or making payments to a utility bill or rent agreement.
Life cover
A type of life insurance. You pay an insurance company an agreed amount. In return, the company pays out a certain amount if you die. You would usually give this amount to your loved ones. You must be honest about your health and circumstances to make sure your life cover pays out.
Limitation period
The time limit a lender has to get back what they are owed. This time limit is usually six years, but it can be between three and 12 years depending on the type of debt.
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Magistrates' court
A court that deals with minor civil or criminal matters. Civil matters are between people and businesses where no crime has been committed. Criminal matters are where there has been a crime.
Magistrates' court fines
Fines set by a magistrate. These are often for non-payment of council tax or parking tickets.
Magistrates' financial penalty
The Magistrates' court may fine you for a driving offence, not paying a fixed penalty notice or many other criminal offences. They can also order you to pay compensation to any injured person or business, and award costs against you.
Mandate of Authority
Also known as a Letter of Authority. A letter that lets a person or organisation do business on behalf of another person.
Marked goods
Items that have been 'marked' by order of the Magistrates' court to be taken in order to get money that is owed. Marked goods must be left at the property until the day of the sale.
Means enquiry
When the court looks over a person's financial situation and come to an agreement about paying back money owed.
Means testing
The method the Government uses to decide if you can get certain benefits.
Meeting of Creditors
Also known as a 341 meeting. This happens during Individual Voluntary Arrangements (IVAs). It is a meeting to find out if the people you owe agree to the terms of your IVA. Not all creditors need to attend, and the person who owes the money will usually have their Insolvency Practitioner (IP) attend for them.
Minimal assets process bankruptcy (MAP)
A type of bankruptcy in Scotland. It is for people with low income and not many items of value (assets). MAP bankruptcy is cheaper and more simple than regular bankruptcy.
Minimum payment
The lowest payment the people you owe will accept for a debt. This is unless a reduced payment plan has been worked out.
Money advisers
People in Scotland who make sure you choose the best option to deal with your debts. There are two kinds of money advisors. There are approved money advisors, who are legally allowed to give debt advice. And there are continuing money advisors who deal with and deliver debt solutions. They do this by looking at your finances and working out which solutions you can have.
Money Judgment
A decision made by the Irish courts for non-payment of a debt.
Money purchase agreement
A type of pension where your final pension depends on stock market performance.
Monthly expenses
Things you pay for each month, like household bills and payments to your debts.
Mortgage
A loan that you take out to buy a house. Your lender could try to take back your property if you miss payments.
Mortgage shortfall
When you hand the keys back to your home or your home is repossessed, and the property is not worth enough to repay the mortgage, the lender can ask for a payment for the difference.
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N11M
A court form that you can apply for at a repossession hearing. This is something that happens if a mortgage lender if trying to take back your property because of missed payments. You can apply for a suspended possession order if you want to stay in the property and come to an arrangement to clear your missed payments. You can also use this to ask for time to find a different place to live if you cannot afford to stay in your home.
N244 application notice
A form used to ask the court to set aside or vary a County Court judgment.
N245 form
A form used to ask the court to pause the enforcement process for a County Court judgment.
Negative equity
When the value of debts secured against a property is more than the property's market value. Like a mortgage that is worth more than the house.
Non-priority debts
Types of debts that are seen as less important than others. They are seen as less important because you cannot lose your home or be sent to prison if you do not pay them back. These are things like credit cards or shopping catalogues.
Northampton County Court bulk centre
Bulk users in court actions are businesses and local authorities. Their claims are issued by this centre in the name of Northampton County Court.
Notice of correction
A short bit of writing added to a credit file to explain why the information on there is not right.
Notice of disassociation
A note that is put on a credit file to remove a financial connection with someone, like an ex-partner.
Notice of intent
Issued in Northern Ireland before a creditor applies to the courts to recover the debt through a judgment. It gives you 10 days to either pay the amount in full, or agree something with your creditor.
Notice of seeking possession
A letter that must be sent to a tenant before a landlord can take court action. It applies to council and housing association landlords.
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Official receiver
Also known as a trustee. Someone who works for the Insolvency Service and deals with bankruptcy.
Ofgem
The regulatory body for the electricity and gas industry. It protects the interests of consumers and makes sure they get value and choice.
Ombudsman
A person or organisation who investigates, reports on and helps settle complaints against companies. You can contact an ombudsman if you think a complaint has not been dealt with in the right way.
Order for possession
An order by the court before a property can be taken back. It lets a creditor take back a property, usually a mortgage lender. The order can be paused if you can work out an agreement with your creditor.
Order for sale
An order from the court to force the sale of a property.
Ordinary cause
A way of making higher value claims through the Scottish courts. This includes debts over £5,000.
Outgoings
Deductions and spending from your budget.
Outright possession order
A court order given at a repossession hearing. It means the courts have given the lender ownership of your property, which means they will take back your property. You will be given an eviction date for 28 days later.
Outstanding balance
The amount left to pay on a debt, loan or overdraft.
Overdraft
The limit a bank account holder can borrow from the bank when there are no remaining funds in the account. Going over the agreed limit will lead to extra charges being added. Not all bank accounts have overdrafts.
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Payment holiday
When a creditor lets you stop paying back what you owe for a period of time.
Pension
A long-term investment plan that gives a lump sum or monthly income when you retire.
Pension credit
A means-tested benefit for people who are over state pension age and have a low income. 'Means-tested' means the amount you get depends on your income and circumstances.
Personal loan
Loans from banks and other financial organisations. They are given to people for personal use. These are paid back within one year or five years. No collateral is asked for or given for the loan.
Policy
A legal document given to you by an insurance company. It tells you the terms and conditions of the insurance.
Possession
When goods are taken to pay back a debt.
Possession order
An order by the courts for a creditor or landlord to evict a person living in the property.
Payment protection insurance (PPI)
A type of insurance that was sold alongside loans, credit cards and mortgages. It covers repayments for a set period of time if you cannot pay because of an accident, illness or unemployment.
Premium
A single or regular payment made to a company for a product.
Priority arrears or debts
Types of debts that are seen as more important than others. They are important because you can lose things you need, like gas or electricity. In really bad cases, you can lose your home or be sent to prison if you do not pay these debts. These are things like your mortgage and criminal fines.
Private pension
A type of pension that does not include contributions from your employer or the government.
Protected trust deed (PTD)
A protected trust deed is a legally binding arrangement in Scotland. You make reduced payments to your debts over four years. At the end of this time, your unsecured debts are usually written off. This means you do not have to pay them back.
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Redemption penalty
Also known as early repayment charges. You may have to pay this if you pay off a debt before the agreement has ended.
Repossession
A legal process where a mortgage lender or secured loan provider takes back a property. Your lender may ask the courts to evict you from your home if you miss mortgage payments. Your lender will then sell the property to raise money towards your debts.
Remortgage
When you take out a new mortgage to pay off one you already have. You use the same house as security. You might do this to change mortgage providers, or if your current mortgage ends.
Right of offset
This can happen when you have a bank account and a debt with the same bank. Your bank can take money out of your account to cover any missed payments to the debt.
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Section 2 order
A court order you can apply for at a repossession hearing. You can apply if you want to stay in the property and come to an arrangement to clear your missed payments. You can also use it to ask for time to find somewhere else to live if you cannot afford to stay in your home.
Secured creditor
Someone who lends money and has rights over some or all of your assets in the event of insolvency.
Secured loan
A loan that is attached to your house. Your lender could try to take your property if you miss payments to a secured loan.
Seizure order
A power the courts in Northern Ireland have. It lets them take items belonging to someone who owes money to pay back the debt. These items have to belong to the person who owes money to be taken.
Sequestration
This is Scottish bankruptcy. Also known as full administration bankruptcy. It is the legal way to write off debt that you cannot afford to pay back in a reasonable amount of time. Any items of value (assets) you own will be sold to pay back your debt.
Sheriff officer
A Scottish court official. They are responsible for giving out court forms and making sure the courts decisions are followed.
Shortfall
This can happen if you have attached a debt to an asset, like your house. You will have a shortfall if you sell the item for less than the debt that is attached to it. If you sell your house for less than the value of your mortgage, your lender will expect you to pay back the shortfall.
Standing order
An instruction to give your bank to pay a certain person or company each month. This must be for a fixed amount.
Stakeholder pension
A type of pension that has to follow Government standards. You can get stakeholder pensions from banks, insurance companies and building societies.
Statute of limitations
Time limits for the court to take actions. In certain cases, court actions cannot be taken after this time has passed.
Statute-barred debt
A legal term for a debt that can no longer be pursued.
Statutory demand
A notice given by the people you owe. It gives you 21 days to come to an arrangement. They can apply to make you bankrupt if you do not.
Sub prime lending
The term for lending money to people who do not have a good credit history. In these cases, lenders will normally charge a higher rate of interest.
Supervisor
The person in charge of looking after proposals for people who are trying to get an individual voluntary arrangement (IVA) or company voluntary arrangement (CVA).
Surplus income
The amount of money you have left over after paying your bills and living costs. This is how much you have to pay back what you owe.
Suspended possession order
A court order given at a repossession hearing. It means that your lender cannot take your property as long as you make the payments each month. The court will tell you what the amount of these payments will be. It is usually your normal monthly payment and something extra to clear the missed payments.
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Tenants in common
Where two or more people own a property. If one of the owners dies, their share of the property passes to their next of kin, not the other owner(s) unless there is a will that says otherwise. The terms are decided by the percentage (%) of the property that each person owns.
Term
The amount of time a legal agreement lasts for.
Term assurance
A type of insurance that pays out a lump sum if you die during the term of the policy. The policy will finish with no payout made if you do not die during the term.
Termination notice
A note on your credit file that says a credit agreement or tenancy has ended. It is usually used to end hire purchase agreements.
Third party debt order
An order for someone who is in debt but is also owed money by a person or business. The order tells that person or business to pay back what is owed.
Tie-in
An agreement to keep a mortgage with a lender for a certain amount of time. You will have to pay a penalty if the agreement is broken.
Time order
A way of asking the courts to give you more time to pay a debt if you have missed payments. It is usually for people who are going through a difficult time. It can change the amount you have to pay each month, or the time left on the credit agreement.
Time to pay direction
A way you can ask to pay in instalments. The courts and the people you owe will look at your situation and make a choice. The court has final say, even if the people you owe refuse.
Token payment plan (TPP)
A way of dealing with your debts for a short amount of time. It is for people who cannot pay back what they owe because of an issue that is not going to last a long time. You pay £1 a month to each of your debts until your situation improves enough so you can pay them more.
Tomlin orders
Legal agreements that put a hold on County Court judgments (CCJs). It tells you what to pay towards a debt. If you do not pay, the CCJ will carry on.
Tracker rate
An interest rate that follows the rise and fall of another interest rate. Like, a tracker mortgage may follow the Bank of England base rate.
Transactions at an undervalue
When you give away an item of value (asset) for less than it is worth. Like giving your car to a friend so it would not be included in your bankruptcy.
Trust funds
Grants that can help individuals or families in need. They can be used to pay missed payments of household bills and costs as well as regular payments.
Trustee
Also known as an Official Receiver. Someone who works for the Scottish courts. They look after a person's bankruptcy or protected trust deed (PTD). The trustee is responsible for giving any payments or items of value to the person's creditors.
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Unit trust
An investment where a group of people leave their money with a professional manager who looks after the total investment fund on their behalf.
Unsecured loan
A loan that is not attached to anything. These are normally called personal loans.
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Variable rate
An interest rate that can go up or down. The amount is decided by the lender.
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Warrant
An order from a creditor to a bailiff to begin a levy. This is a power given to bailiffs that lets them take and sell goods.
Warrant of control
Also known as a warrant of execution. This is something the courts can give the people you owe if you do not pay a County Court judgment (CCJ). It gives bailiffs the right to try to get back the value of a debt by taking items from your home and selling them.
Warrant of execution
Also known as a warrant of control. This is something the courts can give the people you owe if you do not pay a County Court judgment (CCJ). It gives bailiffs the right to try to get back the value of a debt by taking items from your home and selling them.
Warrant of delivery
A way of making sure a court decision for the return of goods or value of goods is followed. A bailiff is given permission to get back the goods or their value from the person who owes money. They would then give the goods or money to the creditor.
Warrant to cite
When a creditor tells a debtor they are going to apply for bankruptcy in Scotland.
Wilful refusal
When you know you have to pay a debt but choose not to, even though you have enough money. It usually happens with non-payment of council tax. You can be sent to prison if this is proven.
Will
An official statement of what you want to happen with any money or property after your death.
Working tax credit
A means-tested benefit for working people who are on a low income to help with everyday living costs. 'Means-tested' means the amount you get depends on your income and circumstances.
Writ of control
Also known as a high court writ. This is something the courts give to enforcement officers to tell them to get back money that is owed.
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