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JUdgment Order-Post Interest Advice
U2fire
Posts: 29 Forumite
A elderly relative of mine has had a Judgment Order issued against him for £137k after a Log book loan of approx £40k spiralled out of control,the loan was intended as a short term loan as a sale completed but the sale fell through.
I am trying to help him as he has buried his head in the sand somewhat.
First i am looking if the figures are correct and everything is correct.
Secondly what cause of action he can take.
The original claim raised by the creditor was for £123k which then grew to £137k in three months by the Judgment date.
Two months later the creditor then applied for a charge on the sale for £147k (£10k interest increase) which was stated in the court application, it was eventually refused.
Post Judgment it has increased to £180k, until he was able to arrange £100 per month to freeze the interest.
The wording in his contract and in the claim papers include the wording "Interest before and after Judgment", but not in the De-Fault notices.
The original figure stated as the "Advanced Figure" in the particulars which the creditor supplied to the court seems to include interest and charges (so in effect the Judge would see a higher figure than was actually borrowed). It is difficult to work the true figure out as he borrowed on 6 separate occasions, and the paperwork just rolls over including interest and charges. My relative has requested several times over the last month a list of his loan without interest/charges but he has had no reply.
His Sale recently completed and he was able to pay the original claim of £123k from all the proceeds.
The Creditor is now threatening to remove the arrangement and start adding interest unless he pays the balance of £57k which he does not have.
All along the Creditor told him that if he was able to pay a substantial amount he would reduce the balance but now is refusing.
If he paid the Judgment figure of £137k is the Order satisfied and would the creditor have to raise a separate claim for the rest of the interest or does the Judgment keep increasing with the interest.
If everything has been done correct what cause of action can my relative take?
Many Thanks
I am trying to help him as he has buried his head in the sand somewhat.
First i am looking if the figures are correct and everything is correct.
Secondly what cause of action he can take.
The original claim raised by the creditor was for £123k which then grew to £137k in three months by the Judgment date.
Two months later the creditor then applied for a charge on the sale for £147k (£10k interest increase) which was stated in the court application, it was eventually refused.
Post Judgment it has increased to £180k, until he was able to arrange £100 per month to freeze the interest.
The wording in his contract and in the claim papers include the wording "Interest before and after Judgment", but not in the De-Fault notices.
The original figure stated as the "Advanced Figure" in the particulars which the creditor supplied to the court seems to include interest and charges (so in effect the Judge would see a higher figure than was actually borrowed). It is difficult to work the true figure out as he borrowed on 6 separate occasions, and the paperwork just rolls over including interest and charges. My relative has requested several times over the last month a list of his loan without interest/charges but he has had no reply.
His Sale recently completed and he was able to pay the original claim of £123k from all the proceeds.
The Creditor is now threatening to remove the arrangement and start adding interest unless he pays the balance of £57k which he does not have.
All along the Creditor told him that if he was able to pay a substantial amount he would reduce the balance but now is refusing.
If he paid the Judgment figure of £137k is the Order satisfied and would the creditor have to raise a separate claim for the rest of the interest or does the Judgment keep increasing with the interest.
If everything has been done correct what cause of action can my relative take?
Many Thanks
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Comments
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Hi
Sorry I'm just about to log out so can't try to help more fully at the moment - but in the meantime have you read the national debtline guideline on charging interest post judgement - its quite a useful read if you haven't seen it - http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=18_interest_charges_on_a_consumer_credit_judgmentA smile enriches those who receive without making poorer those who giveor "It costs nowt to be nice"0 -
If it's not in the default notice, they can't charge it.
This can be a confusing area. When the judgement amount is satisfied, as far as I'm aware - that's it!
They would have to bring a separate claim for the post judgement interest, which I'm sure certain rules within the CPR make it very difficult and it could be deemed an abuse of process.
The key is in the above and the default notice.
Personally, I'm not aware of a case where the creditor has ever actually got the post judgement interest on a debt regulated by the CCA1974.Happiness, is a Kebab called Doner.....:heart2::heart2:0 -
Thanks
have read the debtline and spoken to them, but need some more detailed advice as it looks like his only option is to go back to court and need to take the correct route.Hi
Sorry I'm just about to log out so can't try to help more fully at the moment - but in the meantime have you read the national debtline guideline on charging interest post judgement - its quite a useful read if you haven't seen it - http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=18_interest_charges_on_a_consumer_credit_judgment0 -
Sorry, but I don't think you're listening here!
Once the 137k (judgement figure) is paid - that's it. The judgement is settled.
The creditor will have to bring a separate action to recover the post judgement interest (which should only show on THEIR accounts) - not on the judgement.
The likelihood of them doing this and being successful is slim, as certain CPR rules make it difficult and it would be deemed an abuse of process.
AND as previously mentioned, if it's not on the default notice, they CAN'T charge it.....;)Happiness, is a Kebab called Doner.....:heart2::heart2:0 -
Thanks. But i have to be sure for him to stretch to pay the rest of the funds of the Judgment or if incorrect it would compound his problems.
He has just been informed that the arrangement is not now being honoured and interest is once again being applied.
If he was to pay the Judgment what then? He couldn't risk sitting back and let the figure increase in the hope that it couldn't be enforced.Sorry, but I don't think you're listening here!
Once the 137k (judgement figure) is paid - that's it. The judgement is settled.
The creditor will have to bring a separate action to recover the post judgement interest (which should only show on THEIR accounts) - not on the judgement.
The likelihood of them doing this and being successful is slim, as certain CPR rules make it difficult and it would be deemed an abuse of process.
AND as previously mentioned, if it's not on the default notice, they CAN'T charge it.....;)0 -
You say he's elderly? How many years does he have left do you reckon? It seems ridiculous to even attempt to pay any of this back. I'd just ingore it and go straight to the press/police if you experience any harassment over this debt.B.A - Shut up fool!0
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Police wouldnt get involved, its a cival matter and subject to a court order.Don't put your trust into an Experian score - it is not a number any bank will ever use & it is generally a waste of money to purchase it. They are also selling you insurance you dont need.0
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In the CCA 1974 130A it sates that if a creditor wants to charge interest after Judgment they have to supply a "First required notice" and thereafter further notices within 6 months.
The only Notice he has received is a Arrears Notice 86b of the CCA 1974.Sorry, but I don't think you're listening here!
Once the 137k (judgement figure) is paid - that's it. The judgement is settled.o charge Interest Post Judgment they have to
The creditor will have to bring a separate action to recover the post judgement interest (which should only show on THEIR accounts) - not on the judgement.
The likelihood of them doing this and being successful is slim, as certain CPR rules make it difficult and it would be deemed an abuse of process.
AND as previously mentioned, if it's not on the default notice, they CAN'T charge it.....;)0 -
Ok,
I'll make this as simple as I can.
They can only charge post judgement interest if....
a. It's on the default notice
b. The original agreement has the provision to do so in the terms
c. They give you notice of intent to do so in the correct manner
...Once the CCJ is in place, your creditor must send you a notice to say they intend to charge interest on the judgment. They are not allowed to add interest until they have sent the first notice to you. The notice must tell you the outstanding balance on which interest will be charged. It must also tell you what the rate of interest is and what date the interest will run from. It must also tell you that you can ask the court to change the interest rate and the instalments you pay.
The creditor has to send you a new notice every six months if they want to keep charging interest. The notice must tell you how much interest has been added and the interest rate.
If the creditor does not send you a notice within six months, they are not allowed to charge interest until a new notice is sent. They are not allowed to add interest back in for the time they have missed.
Now,
When you get a CCJ, it's a fixed amount, for example the £137k.
Every payment reduces this balance until it reaches zero, at which point the CCJ is satisfied.
The interest they "think" they can charge accrues in a separate pot (in their accounting system). It DOES NOT add to the judgement figure.
You need to keep track of what's been paid toward the £137k.
If they want the interest which has accrued separately, they will have to bring a completely new action.
As far as I can see, their chances of winning are ZERO.
Not only that, I don't think they will anyway, CPR makes it difficult, it will be deemed an abuse of process and they've not followed the rules to allow them to do so anyway.
They are relying on the ignorance of the debtor and trying it on - this is par for the course for the lending institutions....
Who is the creditor anyway??Happiness, is a Kebab called Doner.....:heart2::heart2:0 -
Thanks
Also how does the CCA 1991 (Interest on Judgments) have a bearing here?
It States GENERAL RULE
(3) Interest shall not be payable under this Order where the relevant Judgment-
(a)is given in proceedings to recover money due under a agreement regulated by the CCA 1974
This agreement was regulated by the CCA 1974
Could he then apply for a time order for the remaining £14k at the arrangment figure that has just been removed.
Would this then bring things to a head?0
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