Can a CCJ be included in Bankruptcy?
If a CCJ (County Court Judgment) has been issued against you Bankruptcy will overturn it. In addition you will be protected against any further legal action.
- Is a CCJ debt written off in Bankruptcy?
- Does Bankruptcy prevent more CCJs being issued?
- What if a CCJ had already been recorded on your Credit File?
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Is a CCJ debt written off in Bankruptcy?
If you go Bankrupt all the unsecured debts that you owe including any CCJs are included. Judgments that have been issued against you for unsecured debts are overturned.
If you have been making monthly payments towards a CCJ you must stop doing this. You are no longer allowed to make direct payments to any of your unsecured creditors. As far as you are concerned the debt is written off.
The Official Receiver (OR) may be able to make additional payments to the creditor. However this could only happen if you have assets which can be sold or you can afford an Income Payment Agreement.
If an attachment of earnings is being deducted from your wages this is also stopped. Your employer will be instructed by the OR to cancel the deduction and pay you as normal.
Does Bankruptcy prevent you from getting more CCJs?
After you are bankrupt you are given legal protection from your unsecured creditors. They cannot take further collection action against you. This means that none of them can apply for a new CCJ against you.
In addition if a creditor has already been granted a CCJ they cannot cannot take any additional legal steps against you. They lose the right to apply for an attachment of earnings or a charging order against any property you own.
However if you are a home owner and a Charging Order has already been issued this cannot be overturned by going bankrupt. A charging order secures the debt against your property.
If a Charging Order has already been issued the debt cannot be included in bankruptcy. The debt still has to be paid in full either by instalments or from the proceeds of the sale of your property.
What happens if a CCJ has already been recorded on your Credit File?
Even though a CCJ is overturned by Bankruptcy the record that it existed still remains on your credit file for 6 years. However there is no reason to be concerned about how this will affect your credit rating.
Bankruptcy itself will negatively affect your credit rating for 6 years. But this will outlast any affect of a CCJ because it will be the last action recorded on your file.
By the time the record of your Bankruptcy comes off your credit file the records of any old CCJs should also have disappeared.
After you are discharged you should check your credit file. Ensure any CCJs are dated no later than the date you went Bankrupt. If they are you can apply for the dates to be changed.
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