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Debt Management Plan DMP

DMP CCJ – All You Need to Know, FAQs & More

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Scott
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Scott Nelson

Managing Director

MoneyNerd’s founder, Scott Nelson, has a decade of financial industry experience, including 6 years in FCA regulated loan and credit card companies. Troubled by a lack of conscience in the industry, he founded MoneyNerd to give genuine advice to those in debt and struggling financially.

Learn more about Scott
&
Janine
Janine Marsh Profile Picture

Janine Marsh

Financial Expert

Janine Marsh is an award-winning presenter and a valuable member of the MoneyNerd team. With a wealth of experience as a financial expert, she's been featured on BBC Radio 4, BBC Local Radio, and BBC Five Live, and is a regular on Co-op Radio.

Learn more about Janine
· Feb 6th, 2024
Could you legally write off some debt? Answer below to get started.

Total amount of debt?

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.

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County Court Judgement

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 County Court Judgment (CCJ) while you’re in a Debt Management Plan (DMP)?

It can be scary, but you’re not alone. Our website is visited by over 170,000 people every month who are seeking advice on their debt dilemmas.

In this simple and easy-to-understand piece, we’ll cover:

  •  What a CCJ is
  •  What to do if you’re feeling worried
  •  How a creditor could get a CCJ against you while you’re in a DMP
  •  Why a creditor might try to get a CCJ against you
  •  What you should do if a creditor tries to get a CCJ against you

Some of our team know what it’s like to worry about debt, so we really do understand how you’re feeling. We’re here to help you learn more about CCJs and DMPs.

Let’s dive in!

Could you legally write off some debt?

There are several debt solutions in the UK, choosing the right one for you could write off some of your unaffordable debt, but the wrong one may be expensive and drawn out.

Answer below to get started.

How much debt do you have?

This isn’t a full fact find. MoneyNerd doesn’t give advice. We work with The Debt Advice Service who provide information about your options.

Can I Include CCJ Debts in My Debt Management Plan? 

As I mentioned earlier, CCJs are a formal and legally binding agreement obligated to you by the court. On the other hand, a DMP is an informal agreement between you and your creditors that is negotiated by a DMP provider. 

As a result, if you have a CCJ and you decide to start a DMP, your CCJ debts will not be automatically included within the DMP. 

Thus, you have two options: 

  • Keep making payments towards your CCJ separate from your debt management plan. 
  • Take actions to get the CCJ included in your debt management plan. 

For the first option, your payments towards your CCJ will be termed as “essential costs” within your debt management plan. Thus, your DMP provider will make sure the payment you make towards your DMP each month are affordable to you given the fact that you’re paying your CCJ debt separately. 

For the second option, you will typically need to apply in order to change the amount you pay towards your CCJ so that it can be included within your debt management plan. 

In order to do this, you’re going to need to send an application to the court using an application form known as N245. 

The court will then take a look at your application and determine whether or not your payment amount should be changed. 

If the court agrees to change the payment you make each month, they will issue an instalment order. After this, you can start paying back your CCJ debt as part of your DMP

I highly advise that you seek debt advice from a professional if you’re going to do this as it can be tricky dealing with creditors and the court. Your DMP provider should be able to advise you about what actions you should be taking and when. 

You can also seek advice from a debt charity such as Stepchange or Payplan. Just make sure that whatever agency you seek advice from is authorised and regulated by the Financial Conduct Authority (FCA). 

How a debt solution could help

Some debt solutions can:

  1. Stop nasty calls from creditors
  2. Freeze interest and charges
  3. 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.

Get started

Can a Creditor Get a CCJ Against Me While I’m in a DMP? 

A debt management plan (DMP) is not a formal agreement. This means that you are not protected from legal action by your creditors when you enter into a debt management plan. 

While a DMP is an informal debt solution and your creditors can pursue legal action against you, this is quite rare as long as you stick to your monthly payments and submit them on time. 

When you enter into a DMP, a copy of your income details, expenditure as well as debts are sent to your creditors. This assures them that you are making payments that you can realistically afford. 

When creditors apply for a CCJ, the court uses similar information to determine what your monthly payment would look like. Thus, creditors are very unlikely to get a CCJ against you if they know they’re not guaranteed to get a higher payment amount than what they’re already getting from your debt management plan. 

» TAKE ACTION NOW: Fill out the short debt form

Why Would a Creditor Pursue a CCJ Against Me While I’m in a DMP? 

As I mentioned earlier, your creditor(s) may pursue a CCJ against you while you’re in a DMP if they feel that they might be able to get a higher monthly payment amount from you in a CCJ as compared to a DMP. 

A creditor may also do this if they want to apply for a charging order against you. A charging order obligates you to secure the debt you owe to that creditor against your home. 

Many creditors prefer getting a CCJ against debtors because this gives them an extra guarantee that they will be regular with their payment(s). 

Thousands have already tackled their debt

Every day our partners, The Debt Advice Service, help people find out whether they can lower their repayments and finally tackle or write off some of their debt.

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I’d recommend this firm to anyone struggling with debt – my mind has been put to rest, all is getting sorted.

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What Should I Do if a Creditor Pursues a County Court Judgment Against Me While I’m in a DMP? 

If a CCJ gets taken out against you while you’re in a DMP, it will get added to your credit file. Make sure that you make your DMP provider aware of this so that they can make necessary adjustments to your monthly payment amount if any.

If a CCJ gets added to your total debt while you’re already in a DMP, then this debt will have to be treated as a priority debt.

A priority debt is a debt that you need to attend to first as missing payments to those debts can have severe consequences. 

This means that if at some point, you can only make a payment towards your DMP or your CCJ, then you should make the payment towards your CCJ and then talk to your DMP provider in order to work something out. 

Could you legally write off some debt?

Answer below to get started.

How much debt do you have?

This isn’t a full fact find. MoneyNerd doesn’t give advice. We work with The Debt Advice Service who provide information about your options.

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The authors
Scott Nelson Profile Picture
Author
MoneyNerd’s founder, Scott Nelson, has a decade of financial industry experience, including 6 years in FCA regulated loan and credit card companies. Troubled by a lack of conscience in the industry, he founded MoneyNerd to give genuine advice to those in debt and struggling financially.
Janine Marsh Profile Picture
Debt Expert
Janine Marsh is an award-winning presenter and a valuable member of the MoneyNerd team. With a wealth of experience as a financial expert, she's been featured on BBC Radio 4, BBC Local Radio, and BBC Five Live, and is a regular on Co-op Radio.