Types of Debt

Debt can take on many forms and isn’t always the result of poor money management. From credit cards to utility bills, find out more about the different types of debt, including how they work and how to deal with them, below:

Business Debt

Financial obligations incurred by companies for growth, operations, or investments, essential for expansion but requiring careful management to avoid financial strain.

Council Tax Debt

Arises from failing to pay local government taxes, impacting personal finances and potentially leading to legal consequences if not addressed promptly.

Credit Card Debt

Results from borrowing through credit cards without full repayment of the credit by the due date, leading to accumulating interest and financial stress over time.

Gambling Debt

Incurred by betting beyond means, often driven by addiction, this type of debt can quickly spiral out of control without intervention.


Occurs from overdue or unpaid taxes such as income, national insurance, or VAT, requiring timely resolution to avoid penalties.

Payday Loans

Short-term borrowing to cover expenses until the next payday, often at high interest rates, leading to a cycle of debt if not managed.

Secured Loans

Involves borrowing against assets, like property, which serves as collateral, offering lower interest rates but risking asset loss on default.

Student Loans

A financial commitment for university education, providing necessary funds but requiring long-term repayment plans post-graduation.

Utility Bills

Accumulates from consistent failure to pay , risking service cut-offs and additional charges, highlighting the need for budget management.


Rent Arrears

Falling behind on rent payments leads to arrears, risking eviction and legal action, underscoring the importance of maintaining rental commitments.

Mortgage Arrears

Financial obligation from borrowing to purchase a home, where failure to meet payments can result in foreclosure, emphasising the need for financial stability.

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