Definition · Glossary
Arrears
Debt & Debt ManagementBad Credit
In plain English
Arrears refers to a debt or payment obligation that is overdue. If you miss a payment on a loan, credit card or bill, the amount you owe becomes arrears. Being in arrears can affect your credit file.
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Example
After missing two monthly loan repayments, the borrower was in arrears of £320.
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Common misunderstandings
- Arrears applies to any overdue payment — not just mortgage payments.