Can a CCJ be included in Bankruptcy?
- 21 Oct 2021
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.
Included in this article:
- Is a CCJ debt written off in Bankruptcy?
- Does Bankruptcy prevent you getting another CCJ?
- 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 another CCJ?
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.
can ccjs be removed from your credit file when you go bankrupt?
Hi Michaelc
If you go bankrupt, all CCJs are included (the associated debt will be written off). However, the record of the CCJ remains on your credit file for the full 6 years from the date of issue. Going bankrupt will not remove these records any earlier.
That said, this situation should not really put you in any worse position. Ultimately the record of your bankruptcy will be added to your credit file and remain there for 6 years. While the bankruptcy record remains, borrowing will remain difficult whether CCJ records come off in the meantime or not.
After 6 years, the bankruptcy record will be removed and your credit file will be clear. All previous CCJs will already have been removed by that time.
You may also to be interested to hear that it is actually possible to start rebuilding your credit file as soon as you are discharged from bankruptcy (after 1 year). More information about this can be found here: How to improve your credit rating after bankruptcy
I have a ccj against an individual she has gone bankrupt can I still persue when the bankruptcy is over?
Hi Brian
The fact that the debtor has gone bankrupt means that you as a creditor are no longer allowed to enforce collection of the debt.
Once the individual’s bankruptcy is over you have no legal right to pursue them for payment. You are only entitled to your share of any proceeds from the bankrupt’s estate as realised by the official receiver. Any outstanding debt has to be written off. It is not collectable.