What is a CCJ?
In England and Wales County Court Judgments (CCJs) are issued by a court on behalf of someone who is owed money i.e. a creditor, and against the person or business that owes it to them.
A CCJ is one of the last steps taken in the debt recovery process, so it is unlikely that you will have one without knowing about it. You would have received many letters and phone calls trying to chase you for the debt before a CCJ is issued. Once a CCJ is issued it is marked on your credit record, even if you subsequently clear the debt.
Does it affect my credit rating?
Having a CCJ does have an effect on your credit rating. You are less likely to be able to obtain a mortgage or unsecured credit, particularly from the high street banks and building societies. You will be restricted to a smaller amount of lenders, most of who charge higher rates of interest. These are known as Bad Credit Loan companies. You may also find that if you get into trouble with the payments, the lenders may not be as lenient and helpful as a larger, more well known companies.
If you have been issued with a CCJ and miss payments regularly the creditor may apply for a charging order which would secure the debt on a property or asset. Creditors can also apply for an attachment of earnings which would force the debtor's employer to deduct a percentage of their earnings from their salary and send them to the court. A Third Party Debt order would oblige a third party who holds money belonging to the debtor (for example a bank) to pay the debt. It is also possible to have the court appoint a County Court Bailiff to collect the debt. A Bailiff is an official of court and has the power to seize goods and sell them at auction to settle a debt.
If you receive a letter telling you someone is making a County Court Claim against you, don't be alarmed. Contact Us on 0800 043 2027 for immediate advice.