I owe people money

Owing people money can be a very stressful experience - whether it’s a friend or family member who has lent to you, or a creditor. You may be tempted to ignore letters or phone calls from either but unfortunately it isn't going to make the problem go away. Here's how to get back on track when you owe people money.

Get help when you owe people money

"I owe you HOW much?"

Jump to section:

  1. I owe money to someone – what can I do?
  2. What should I say to a creditor?
  3. Agreeing to a payment plan
  4. How can I keep creditors happy?
  5. Reducing your interest on payments
  6. My creditor was not helpful, who can I speak to?
  7. I’m being harassed to pay, what can I do?
  8. What can I do if I’m being threatened with court proceedings?
  9. Help with court summons for debt

I owe people money – what can I do?

You might not know what to do when you owe people money, whether that’s someone you know or not. It can be particularly stressful if you don’t have the money to pay them back yet. If it’s a business that you owe money to, the best thing to do is to contact your creditors (the people you owe money to) as soon as you have a problem. You can ask them to freeze any interest.

What should I say to a creditor?

The earlier they know about any problem, the more sympathetic they are likely to be. Creditors don’t have to accept your offers. But they may agree to a smaller payment over a number of months if they can see over time that your situation is improving. It can be intimidating to make the phone call, but you’ll feel much better for it when you do.

Here are some do’s and don’ts:

  • Don’t make an offer you can’t afford – start by offering a small, but regular, payment – this is better than no payment, or one that you can’t keep up.
  • Don’t ignore letters or demands, as tempting as it may be. Putting it off shows the creditor that you’re not willing to pay, and they might take further action to get their money back.
  • Do warn creditors if a change in your circumstances will affect you from keeping to your credit agreement once you’ve made it.
  • Do try to sort things out quickly to stop costs piling up – Creditors may add the costs of phone calls and written reminders to the interest you are already paying.
  • Do avoid taking out a loan to consolidate your debts until you’ve had financial advice.


If you’re still worried about contacting a creditor because it makes you feel anxious, we recommend contacting StepChange for advice. They’ll be able to give you free advice to reassure you before you speak to creditors. And they’ll be able to answer any questions you might have.

Agreeing to a payment plan

Once you’ve spoken to a creditor, you might have agreed a payment plan with them where you’re able to pay off your debt in affordable chunks. After the call, it can be helpful if you follow up with a letter or email. Ask them to confirm what you said and ask them not to take any further action during this time. You should also:

  • Send your creditors a financial statement showing your income and outgoings. You may have to prove this with wage slips and benefit details.
  • Explain your offer to pay off your debt and any steps you are taking to increase your income or reduce your spending. The aim is to show how much you need to live on and that your offer is fair.


Always keep any copies of letters you write and any that you receive. Make notes of any phone calls, dates and the names of the people you speak to. If you can’t get the creditors to agree any offers, get help from an advisor from either StepChange or Citizen’s Advice Bureau who will be able to help you.

How can I keep creditors happy?

By contacting the people you owe money to, you’ve already taken a great first step towards showing them that you do intend to pay them back. If you’re facing pressure from them, there are some further steps you can take to keep them happy, such as:

  • Get some debt counselling. This will prove you are being proactive in sorting out your problems
  • Apply for a court order that allows you to pay only a proportion of the debts. This is called an Administration Order
  • Arrange a legal agreement with your creditors, known as an Individual Voluntary Arrangement (IVA)


Remember whilst you’re talking to the creditors, that you need to be able to pay your rent, and afford food. You don’t want to be putting yourself in a vulnerable position, so try not to be pushed into repayments you can’t afford.

Reducing your interest on payments

Interest on repayments just means that the total just gets higher before you’re able to really pay any of it off. Some companies might stop charging you interest payments on loans/credit cards – but you must ask them for this.

Try to stick to any agreement made about reduced payments. They’ve done you a favour, and won’t like it if you go back on your word. If you’ve made any arrangements by phone, follow this up with a letter stating clearly what has been agreed.

My creditor was not helpful, who can I speak to?

If the first person you speak to in the creditor’s office is unhelpful, be persistent and go higher up. Make payments to the creditor anyway, even if they say the offer is too low. The company may be a member of a trade association, so if you feel you’ve not been treated sympathetically you can complain to the association.

I’m being harassed to pay, what can I do?

Being chased for payment by someone you owe money to can be uncomfortable. But unfortunately creditors are entitled to keep reminding you if you don’t pay – as long as they don’t resort to improper methods.

A creditor may also have transferred your case to a debt-collecting agency. It’s illegal for a lender, or a lender’s agent, to keep demanding payment by phoning you late at night, or too frequently at home or work. Nor should they park a van marked debt collectors’ outside your home, nor contact your employer.

You can’t be prosecuted in the criminal court because you haven’t paid your debts. However, some lenders might try to make you think you can. If you’re being harassed or discriminated against tell your local trading standards department or the police.

What can I do if I’m being threatened with court proceedings?

If you’ve been keeping up with your repayments, it should mean that your creditor will be unlikely to take you to court over what you owe. In fact, most creditors would also want to avoid court action as it can be a lengthy procedure and can also be very expensive. However if you’ve refused to pay them, they might resort to it as a last action.

If a creditor does intend to take you to court, you’ll receive a written notice which will then be followed by court papers. If court action has started, it’s important not to ignore the papers. You should fill in the forms you receive with the summons as soon as possible. Send them back to the court or the creditor, as instructed.

Help with court summons for debt

Citizens Advice Bureaus, law centres, Money Advice Centres and welfare rights services can help you fill in the forms and explain the steps involved. You might be able to obtain legal aid and be legally represented in court. In the small claims court you can have a lay representative (someone to speak for you who isn’t a solicitor or lawyer). Some Citizens Advice Bureaus offer this service.

Next Steps

  • StepChange offers free advice on your debt problems, basing it round what's right for you. 0800 138 1111
  • Chat about this subject on our Discussion Boards.
  • Need help but confused where to go locally? Download our StepFinder iPhone app to find local support services quickly.

By Holly Turner

Updated on 30-May-2021