Understanding CCJs In The UK
A large and increasing number of UK citizens are suffering financial problems at the moment. Debts of all kinds can build up, and weekly or monthly income may not be enough to cover the minimum repayments, while leaving money over for vital necessities such as rent and utility bills. Unpaid creditors may take action in the county court, obtaining a CCJ or County Court Judgment. CCJs in the UK must be treated as priority debts, and paid off as soon as possible.
Charities and other groups have recently reported large increases in the number of clients with personal debt problems. Many people have debts equal to many times their annual income.
The different types of debt can be divided up into priority and non-priority debts. For example mortgage debt is classed as a priority, as defaulting on this can lead to a home repossession, while credit card debts are usually classed as non-priority.
Money may also be owed to utility companies (gas, electric, water, telephone) or to landlords. These debts are also treated as a priority, as services may be disconnected if they are not repaid.
When a debtor defaults on a debt, the creditor is entitled to take various steps to recover the money owed. After sending out final demand letters, they will issue a default notice, and may employ a collection agency.
Action in the county court is usually a last resort for the lender, but it will happen if the borrower does not make any arrangements to pay. When a CCJ is obtained the court will specify a monthly installment which must be paid.
Continued failure to pay can lead to an attachment of earnings order, a charging order, or a warrant which will lead to a visit by bailiffs. In view of the consequences of these options, a CCJ should be treated as one of the highest priority debts.
Regardless of the level of indebtedness, or the stage in the CCJ process, it is always worth contacting a specialist organization (e. G., Citizens Advice) for free and impartial debt advice. The counselor can help with budgeting, and with dividing debts into priority and non-priority categories. Solutions such as an IVA or a DMP can be investigated and set up. Generally creditors will prefer to work with a debtor who can set up a realistic and sustainable repayment plan, such as a DMP, rather than seeking enforcement through the courts.
If you are worried about a possible CCJ, then contact Payplan for more information.
