Is a default a CCJ? What You Need To Know
For free & impartial money advice you can visit MoneyHelper. We work with The Debt Advice Service who provide information about your options. This isn’t a full fact-find, some debt solutions may not be suitable in all circumstances, ongoing fees might apply & your credit rating may be affected.
For free & impartial money advice you can visit MoneyHelper. We work with The Debt Advice Service who provide information about your options. This isn’t a full fact-find, some debt solutions may not be suitable in all circumstances, ongoing fees might apply & your credit rating may be affected.
Are you worried about a bailiff knocking at your door or your belongings being taken away because of a default notice? You might be asking, “Is a default a CCJ?” Don’t fret; you’re at the right place.
In this article, we’ll cover:
- What a default notice is and how it differs from a County Court Judgement (CCJ).
- Tips on what to do when you get a default notice.
- The consequences of a default and a CCJ, and which one is worse.
- How to deal with a CCJ claim and what happens if you ignore it.
Lastly, we’ll guide you on how to repair your credit history after a CCJ and where to get professional advice.
We understand your fears, as we’ve had over 170,000 people each month visit our site for advice on debt problems. Some of our team have even faced similar situations. So, rest assured, we understand your situation and are here to help you navigate through it.
What is a Default Notice?
You may receive a notice of default when you miss a payment or don’t make the full payment of the repayment instalment. The reason for this notice is that you have broken the terms of the credit agreement. If the default is applied to your account, it’s recorded on your credit history. This can harm your credit score. Additionally, a default notice will stay on your credit file for six years.
What Happens When You Get One?
If you cannot catch up with the missed payments, you’ll be asked to clear the outstanding debt in full. You have the right to offer to pay the debt in instalments, however, the creditor doesn’t have to agree to the instalment plan.
It is worth gathering all your financial information in a monthly budget tracker, such as the one I have freely available for download. Use this tracker to help you work out how much you can afford to pay to your creditor. You can even use it to show how you came to the amount you propose to support you in your bid to repay the amount in affordable instalments.
If an instalment plan is refused, or you fail to respond to the default warning, the creditor can:
Pass the debt over to debt collectors
Take court action to recover the debt with a CCJ
Take court action to recover the debt to reclaim goods if the debt relates to a hire purchase (such as a car).
How a debt solution could help
Some debt solutions can:
- Stop nasty calls from creditors
- Freeze interest and charges
- Reduce your monthly payments
A few debt solutions can even result in writing off some of your debt.
Here’s an example:
Situation
| Monthly income | £2,504 |
| Monthly expenses | £2,345 |
| Total debt | £32,049 |
Monthly debt repayments
| Before | £587 |
| After | £158 |
£429 reduction in monthly payments
If you want to learn what debt solutions are available to you, click the button below to get started.
What Should You Do When You Receive It?
Your creditor will write to you and give you a warning that you’re at risk of defaulting on your account. You’ll be told a time frame by that you’re required to catch up with the missed payments. The creditors need to give you a minimum of 2 weeks to respond, but it could be up to 30 days. Check the details in the letter to see how long you have.
If you can catch up and pay the missed payments and any additional charges within the set period, the notice of default won’t be applied. This is the best outcome and I recommend trying to catch up with payments, if possible. Speak to a debt advisor if you are struggling.
» TAKE ACTION NOW: Fill out the short debt form
Which Is Worse?
You may think that a default notice is the same as a CCJ as both remain on your credit file for 6 years. However, there are big differences between default and CCJs. A CCJ is far more serious than a default. A creditor must take you to court for a CCJ and the court will decide how and when you must repay the debt. Failing to pay the debt as ordered can lead to further legal action and enforcement of the debt is possible with the use of bailiffs.
You will have to deal with a default notice in the same way as a CCJ. You must contact the creditors, or reach out to a debt advisor, to assist you with contact if you find it difficult to do so. Debt advisors will help you with working out your budget and provide information regarding debt solutions that could help you with your current situation.
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Consequences of Failing to Pay
You default on a CCJ If you fail to keep up with the agreed repayments as set out by the court. If this happens your creditor can
Instruct bailiffs to recover goods from your property. Bailiffs have the legal right to collect items from your home and sell them to raise the money you owe the creditor.
Apply to have the money taken directly from your wages with an attachment of earnings
Use a Charging Order to take the money from the sale of your shares or property
Apply to have you made bankrupt if you owe more than £5,000. Remember to contact a debt advisor if you’re struggling to manage your debts. Additionally, I have lots of information below that you might find useful when facing a default notice or CCJ.
