First Rights of Appropriation

If you know that your accounts are at risk and to avoid any wages or benefits being taken as soon as they have been deposited into your account, you could exercise your ‘first right of appropriation’. This is a temporary measure under common law, allowing you to earmark funds for specific essential bills - for example your rent, your mortgage and your gas or electricity.

You will need to put this request in writing to your bank or building society and list the bills you need to be earmarked.

It is important that you keep a copy of the letter in case there is any dispute later. You may also want to ask your bank/building society for a written acknowledgement of your instructions.

If there are any items you no longer want to pay from your account, or which you cannot afford, you should give your bank separate cancellation instructions. This is because the first right of appropriation does not stop the bank paying items in addition to those you have listed. If you do not cancel these items, your bank may return the items as unpaid, which you could be charged for. However, payments from your account to re-pay a loan with the same bank cannot be cancelled.

When you make a 'first right of appropriation' request, your bank can make a decision to either freeze your account and/or remove an overdraft facility if you have one. You need to make sure that you can manage either or both of these situations before you make the request.