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Whether you’re seeking out an organised debt management plan or you’re trying to resolve your debt problems alone, one of the most important things to do is to prioritise your debts. If you have debts from multiple creditors, deciding which ones are the highest priority can be difficult.

Here are the highest priority debts you should look to clear as soon as possible.

Mortgage or Rent Arrears

The simple fact of the matter is that if you fail to pay your rent or mortgage, you could lose your home. With mortgage arrears, you could even face legal action and the lender you take possession of your home. With mortgage arrears, your landlord could evict you, leaving you without a home and still owing the money. As soon as you find yourself in any difficulty meaning you cannot afford your mortgage or rent, you should contact your lender or landlord as soon as possible and explain the situation fully. Treat this as a high priority payment.

Tax, National Insurance and VAT

Failing to pay tax could lead to bankruptcy and potentially even criminal proceedings against you. This is certainly a high priority debt.

Council Tax

Again, this is a debt that should be considered high priority, as failure to pay could result in legal action against you. Hire Purchase Agreements on Essential Items. While hire purchase payments against non-essential items should be considered low priority, essential items that require a monthly payment should be high priority. Examples include a car that you use for getting to work. Any item where losing it will inhibit your ability to go to work or to live is an essential item.

Gas and Electricity

Gas and electricity companies have the right to cut the supply to your home if you fail to pay and as such this is again a high priority bill. Of course you should pay your water bill as well – though water cannot be cut off and as such should be treated as a lower priority debt.

At the end of April 2011, personal debt in the UK amounted to £1,452 billion – the current sum total of personal debt is almost equal to the country’s entire GDP for 2010.

The average household debt stands at £55,854 (or £8,121 if mortgages are excluded) – a property is repossessed every 14 minutes in the UK and landlord possession orders are made 265 times a day. £179 million is paid in interest every 24 hours, and an individual is declared bankrupt or insolvent every 4.36 minutes.

The total amount of lending in April 2011 increased by £1.2 billion (there was a £700 million increase in secured lending and a £500 million increase in consumer credit lending). At the end of April, total secured lending had reached £1,241 billion and total consumer credit stood at £211 billion.

In the past year, £9.5 billion of loans were written off by UK banks and building societies, which is equivalent to £20.71 million every day, and the Citizens Advice Bureau deals with nearly 10,000 people struggling with debt problems daily.

Redundancy is fuelling increasing levels of debt, with 1,384 people made redundant every day and 850,000 unemployed for 12 months or more.