On Saturday night, I was in deep discussion with my friends about the purpose and necessity of credit and how it can be used. We were not taught anything about the subject at school and therefore we had all gained different understandings of it through various means. It could have been an Economics A-level (like myself), a conversation with a friend or even heartfelt advice from parents that we should only ever have a debit card.
Through working at Registry Trust, my knowledge of the UK credit market, and the factors that influence it have increased tenfold. I find quite often when I discuss my job with my peers, they are not often aware of what a CCJ is at the outset. This concerns me deeply. It demonstrates how little knowledge there is of these financial methods or of the significance and impact they can have on someone’s life if they were to receive a judgment. In our data, there is an emerging trend in the number of judgments issued against those born in the 1990s. Over the last 5 years, they have seen the biggest increase in number of judgments whilst the total value remains low. This generation, worryingly, appears to lack a level of financial awareness - demonstrating a need for accessible and practical education to equip them with the knowledge to address economic problems as and when they occur.
Thinking about practical financial education, I wanted to use this blog to explain exactly what a County Court Judgment is. And to explore the relevance and importance of CCJs in the economy and to highlight why financial literacy is essential.
A County Court Judgment (CCJ) is what happens when a claimant, believing money owed to them won’t be returned, takes their case to a court. If the court rules in favour of the claimant, a court orders the defendant to repay the money. The record of this order is called a CCJ. In other words, a CCJ is a court order that is issued against a debtor who is unable to repay money owed.
Once a CCJ is issued, it is recorded on the Register of Judgments, Orders and Fines which we run and manage, on behalf of the Ministry of Justice, here at Registry Trust. This is a public register and is available for anyone to search via TrustOnline. There are only two exceptions to a judgment appearing on the register. The first, is if the defendant paid off the judgment within one calendar month of issue, meaning the judgment is then cancelled and removed from the register. If the debt is paid in full after this period, the judgment remains on the register but is marked as satisfied. The second exception is if a court rules the judgment is to be ‘set-aside’ due to inconsistencies in the case, which could be because of an incorrect defendant address or the claimant not following the correct processes. Only the courts can make these decisions.
A key importance of a CCJ is provision of justice for the claimant. If money is owed and unlikely to be repaid, it is important that the legal system has the means to ensure that the money is returned. Displaying a record of judgments in a singular register ensures that there is transparency and accountability for all.
Judgments are vital in ensuring credit decisions are based on the financial reality of individuals. If you have a CCJ it will make credit a lot harder to access. This is because a judgment signifies an inability to pay off a previous debt and signifies that there is a potential risk that this might occur again. This may seem unfair but is also a legitimate way of protecting an individual against further financial insecurity. Not being able to access credit might motivate an individual to seek money and debt advice from great services provided by charities such as StepChange, ultimately transforming someone’s financial life for the better.
It is important to understand that it’s not just access to credit that might be impacted if you have an outstanding judgment against you. People can also struggle to obtain insurance, tenancy contracts, or in some industries, a new job.
To conclude this blog, I want to come back to the point I raised to at the beginning of the blog. Understanding how judgments fit into the credit sector and wider economy is essential for people to be able to make use of financial products. But there is a lack of financial education to get people here.
In 2020, the Money and Pensions service launched their UK Strategy for Financial Wellbeing. As one of their aims, they give financial foundations, ensuring financial education begins at a young age. We support this aim fully here at Registry Trust. Low financial literacy drives lack of awareness. But, simply put, the more people know about financial reality the greater inclusion into a fair economic society is possible. Therefore, it is essential to create financial curriculum that offers the basic what and how questions on finance and economics.
From 2 years old to 99 years old, we all need financial assistance and support. With a wealth of services out there, directing the best services to those most in need is vital. Creating a holistic approach to financial wellbeing is essential and I hope that reading this blog has helped, even if just in a small way, you understand what a CCJ is.
The current process isn’t perfect, and there are limitations to it that I will explore further in an upcoming blog, so remember to check back soon!
In the meantime, if you want any more detail on CCJs and the judgments process, please visit our Help Topic pages which answer specific questions about different types of judgments and how different jurisdictions handle each process.
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