When landlords or agents do credit checks on prospective tenants it's very important to:
1 - Verify the identity of the applicant before you do the check. This is done by having sight of original documents - recent bank account statement, driver's licence or passport with photos, and utility bills. There is a growing incidence of tenancy applicants presenting themselves as someone else when they know there is adverse information on themselves.
2 - Establish the applicant's current and previous addresses for at least the last 3 years. CCJs are recorded against the addresses where people live or have lived, so without the correct information we cannot always ascertain a complete record check.
A County Court Judgment is issued when a claimant (someone who is owed money) successfully sues the defendant (someone who owes money) in the County Court.
This is quite a lengthy process and one which gives the defendant ample opportunity to preset their site of the argument. The judge will decide on the weight of evidence presented on both sides whether to issue a judgment or not. Once the judgment is issued the defendant is known as the judgment debtor.
Where the defendant fails to respond to correspondence or to attend hearings, CCJs can be issued as a default judgment. So, in theory, though unlikely, it is possible for a person to have a CCJ issued against them without their knowledge.
There are basically 5 options for a debtor when a claim is issued:
- Pay up in full when the court papers arrive, plus any interest and court fees claimed, and the matter will go no further.
- Request a schedule of payments in installments. A CCJ will be issued automatically.
- Dispute the claim and put forward reasons and any evidence by return, with the court papers. Any monies not in dispute should be paid right away or a request for a schedule of payments made. Later, at a hearing, the court will decide who is right.
- Make a counter claim against the claimant.
County Court hearings are informal and held in private. Defendants must attend if they are disputing the claim - the court will consider any evidence presented in the admission form.
If the court decides against the defendant it will issue a CCJ. The CCJ is a court order stating that the debt must be paid and setting out any terms (e.g. in full within 14 days or regular monthly payments).
Where a judgment debtor fails to pay, the claimant has various options to enforce its judgment - this could involved requests for more financial information on the defedent, attachment of earnings orders and bailiffs.
The Register of Judgments, Orders and Fines records CCJs for 6 years.
Banks, lenders and landlords can do CCJ checks against the CCJ register when deciding whether to deal with the judgment debtor.
Getting a loan, a mortgage, a tenancy or even insurance cover can sometimes be very difficult if there are unsatisfied CCJs outstanding.
- Nearly all CCJs will go on the register:
- If the debtor pays in full within one month of the date of judgment the CCJ will be removed from the register.
- If the debtor pays up in full after this, the CCJ stays on the register, but it will be recorded as 'satisfied' (Certificate of Satisfaction). Otherwise it is shown as unsatisfied.
- There is only one way to remove a CCJ. This is to ask the Court set aside the judgment in the light of additional evidence or facts.
- It is possible that a CCJ may remain recorded on an applicant's Credit Report, with one of the major credit reference agencies, even after it has been satisfied. In this case the applicant should apply to have his or her report amended.
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