Often when you see adverts for loans – particularly debt consolidation loans – you’ll hear them speak of ‘CCJs’ as something that might have prevented you from being approved for a loan elsewhere.
CCJs are County Court Judgements, and are a legal process designed to resolve issues such as non-payment by taking your client to court.
Understandably, if someone has a CCJ against them for non-payment, it can make it much more difficult to get credit in future – which is why advertisers mention them on their loan commercials.
Applying for a CCJ
In general, court action should be a last resort when all other efforts to make your client pay have failed – you should try alternatives first, such as a reasonable extension to the payment deadline, accepting payment in instalments, debt collection or entering into a mediation process to avoid going to court.
For small claims, you can use the Money Claim Online website to instruct your client to pay without having to attend a court hearing in person; however, if they still refuse to pay, you could find this ends with a court appearance anyway.
For larger claims and in circumstances where Money Claim Online is unsuitable, you can apply directly to your County Court to instruct your client to pay you – there may be a hearing you have to attend in person, and there’s a fixed fee depending on how much money you are claiming for.
The government’s advisory website Directgov sets out the fees for both Money Claim Online, and for County Court applications, and can help you to decide whether either process is appropriate for you.
Enforcing a CCJ
Generally speaking, a CCJ is a clear indication to your client that it’s time to stop pushing their luck and pay what they owe you.
However, you may still encounter individuals who refuse to pay you, despite having a CCJ entered against them.
In those circumstances, it’s usually a case of heading back to court to have even more forceful action taken against the client.
This might mean petitioning for them to be made bankrupt, if what they owe you is sufficient in scale, or obtaining a portion of their wages directly from their employer until the debt is settled.
In cases where the judgment value is in excess of £600, you may need to go to the High Court for further action – but this can enable a High Court Enforcement Officer to gain access to the debtor’s premises and remove goods or assets.
Getting professional help
ByteStart’s Guide on How to enforce a County Court Judgment explains in greater detail what exactly you need to do to enforce a CCJ.
Depending on your level of familiarity with the CCJ process, you might choose to enlist professional help to make sure the process runs quickly and smoothly.
Solicitors are one option. Most legal firms will charge an hourly rate for their services so you will need to ask them for an estimate on what the total cost could be.
Specialist debt recovery firms are another alternative. These will often work on a commission basis, taking a percentage of any funds recovered, in place of an up-front or hourly fee. This means that you will only pay if they are successful in recovering your money.
There may still be unavoidable fees associated with the process, but by working with a debt recovery specialist, you can make sure these are all agreed upfront.
This article was written for Bytestart by Bob Bardsley on assignment for Safe Collections.