"I could be sent to prison for my debts"
Many people worry that they could be sent for prison for not paying their debts. While this was a real risk in past, there’s absolutely no need to worry about prison for almost all debts nowadays.
A prison sentence could technically be enforced for non-payment of the following debts, but this is extremely rare:
Even with these types of debt, prison is a last resort that’s normally only considered if you’ve ignored the debt or refused to pay.
There are no other debts you could be sent to prison for not paying. However, it’s important that you get help with any debts you’re struggling with as soon as possible.
"If I get married, I’ll take on my partner’s debt"
If you get married, you won’t be responsible for any debts or financial obligations that your partner had beforehand. You’re also not liable for any debts or credit products they take out in their own name after you’re married.
If you take out a joint loan or a mortgage or open up a bank account together, you’ll both be liable for these debts. This is called 'joint and several liability’. If you live in England or Wales, you’re also jointly liable for any council tax debt that’s owed on the property, regardless of which person pays the bill.
Another exception is water rates. Any other adult in the property can be held liable for the water usage during the period they lived there, even if they're not named on the bill.
"When I die, my family will have to pay off any debts I owe"
If a person dies and leaves behind unsecured debts that are in their name only, the unpaid balance will be settled with any money available in their estate. This is made up of items such as a house, savings and investments.
A deceased person's personal representative might be held liable for their debts is they don't administer the estate properly.
Most unsecured creditors will normally only pursue a deceased person’s debt if they left behind a large estate, such as a house owned outright with lots of equity.
If the person had no assets at the time of death, any debts they owed in their name only will be written off.
If they leave behind a joint debt that needs to be paid, the surviving person will be liable for the full balance.