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  • FIRST POST
    • Higher
    • By Higher 13th Oct 19, 12:32 PM
    • 16Posts
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    Higher
    CCJ & Defaults about to pass 6 years/expire. Is it worth paying them off?
    • #1
    • 13th Oct 19, 12:32 PM
    CCJ & Defaults about to pass 6 years/expire. Is it worth paying them off? 13th Oct 19 at 12:32 PM
    Hi all,

    After many years of financial instability due personal issues I ended up with a number of defaults and a CCJ. I wasn't in a position to pay these off previously and they have pretty much all just been ignored other than the CCJ which I make a small token payment to each month to keep them off my back.

    I am now in a position where I could pay all of these debts off but I am wondering if it is even worth doing. The majority of the defaults pass 6 years/expire within the next 6 months. If I pay them off is that going to benefit my credit file in any way or would it make no difference once the 6 years is up?

    The CCJ still has a few more years until it drops off my credit file but again is it worth me paying it off seeing as they currently seem happy with the small amount I pay each month?

    I know really it would be ideal and fair if I payed off everything I owe but at this stage after finally getting my finances in order, if paying the debts off isn't going to change my credit score then is there any point.

    I have spoken to step change debt charity or also check my file. Neither could really give a straight answer to my questions and were unsure whether even after the 6 years / expiration of my debts, that possibly they could still be affecting my credit score in the background due to them not being settled.
Page 1
    • Willing2Learn
    • By Willing2Learn 13th Oct 19, 12:47 PM
    • 4,604 Posts
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    Willing2Learn
    • #2
    • 13th Oct 19, 12:47 PM
    • #2
    • 13th Oct 19, 12:47 PM
    Hi,

    Definitely, you should continue paying your CCJ, as the creditor could still seek enforcement options should you stop paying.

    With the other debts, can you list them, stating the default date for each account, and when the last payment was made to each account.

    Basically, I am wondering if any of the accounts are statute barred.

    Unsecured debts, including most loans, credit cards, catalogues and overdrafts will normally be statute-barred in England and Wales if you can say YES to all the following four points:
    • it had been more than six years since you last made a payment; and
    • the creditor has a cause of action more than six years ago; and
    • you haven’t acknowledged the debt in writing during this time; and
    • the creditor hasn’t already gone to court for a CCJ.

    Just to add, that the 'cause of action' would be the date of default for each account.
    Last edited by Willing2Learn; 13-10-2019 at 12:55 PM.
    I work within the voluntary sector, supporting vulnerable people to rebuild their lives.

    I love my job

    • Gary_Dexter
    • By Gary_Dexter 13th Oct 19, 1:17 PM
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    Gary_Dexter
    • #3
    • 13th Oct 19, 1:17 PM
    • #3
    • 13th Oct 19, 1:17 PM
    It’s up to you.

    Either pay off in full now if you can or continue with the token payments.

    Just don’t stop paying on any occasion even when they drop off your credit files.
    • sourcrates
    • By sourcrates 13th Oct 19, 1:23 PM
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    sourcrates
    • #4
    • 13th Oct 19, 1:23 PM
    • #4
    • 13th Oct 19, 1:23 PM
    A county court judgement never becomes statute barred, but, after six years has passed, if a creditor wanted to further enforce the judgement, they would need to ask the courts permision to do so, this may, or may not be granted, depending on the circumstances, so non payment may still trigger further action.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File and Ratings, Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to:
    forumteam@moneysavingexpert.com.
    Any views expressed are mine and not the official line of MoneySavingExpert.com.
    For free debt advice, contact either : Stepchange, National Debtline, CitizensAdviceBureaux.
    • fatbelly
    • By fatbelly 13th Oct 19, 2:15 PM
    • 14,317 Posts
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    fatbelly
    • #5
    • 13th Oct 19, 2:15 PM
    • #5
    • 13th Oct 19, 2:15 PM
    I have spoken to step change debt charity or also check my file. Neither could really give a straight answer to my questions and were unsure whether even after the 6 years / expiration of my debts, that possibly they could still be affecting my credit score in the background due to them not being settled.
    Originally posted by Higher
    Looks like you're getting better advice on this site than from Stepchange, then.

    For your normal entries, the entry disappears six years after being defaulted or settled, whichever happens first. They do not come back and so do not affect credit rating (score is meaningless).

    For ccj entries they stay for six years from judgement.

    Under England/Wales law, nothing expires, though debts may become unenforceable as posters above have explained.
    • Higher
    • By Higher 14th Oct 19, 12:46 AM
    • 16 Posts
    • 0 Thanks
    Higher
    • #6
    • 14th Oct 19, 12:46 AM
    • #6
    • 14th Oct 19, 12:46 AM
    Thank you all for your responses.

    I do not think any of the debts are statue barred just yet. Seeing as the defaults have not reached six years.

    I wasn't suggesting I'd stop paying the CCJ, I was just wondering if there was any point in me clearing the debt before the 6 years is up. If I carry on paying the monthly token payments, the CCJ would be nowhere near payed off when it reaches 6 years. But it sounds as though there's no benefit to me paying it off early anyway? With a CCJ is there any scope for getting it payed off as a reduced settlement?

    Regarding the defaults, it sounds as if there is no benefit to paying them off if they are going to drop off after 6 years anyway so I'll just let leave those. I've just heard conflicting information that if not payed there still may be something showing on my credit files even after the 6 years has passed?

    What's the difference between credit rating and credit score fatbelly?
    • boo_star
    • By boo_star 14th Oct 19, 3:57 AM
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    boo_star
    • #7
    • 14th Oct 19, 3:57 AM
    • #7
    • 14th Oct 19, 3:57 AM
    Thank you all for your responses.

    I do not think any of the debts are statue barred just yet. Seeing as the defaults have not reached six years.

    I wasn't suggesting I'd stop paying the CCJ, I was just wondering if there was any point in me clearing the debt before the 6 years is up. If I carry on paying the monthly token payments, the CCJ would be nowhere near payed off when it reaches 6 years. But it sounds as though there's no benefit to me paying it off early anyway? With a CCJ is there any scope for getting it payed off as a reduced settlement?

    Regarding the defaults, it sounds as if there is no benefit to paying them off if they are going to drop off after 6 years anyway so I'll just let leave those. I've just heard conflicting information that if not payed there still may be something showing on my credit files even after the 6 years has passed?

    What's the difference between credit rating and credit score fatbelly?
    Originally posted by Higher
    There's no reason to pay it off early other than it being "the right thing to do."

    This is especially true when the debt will fall off your files anyway.
    • Gary_Dexter
    • By Gary_Dexter 14th Oct 19, 7:47 AM
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    Gary_Dexter
    • #8
    • 14th Oct 19, 7:47 AM
    • #8
    • 14th Oct 19, 7:47 AM
    You need to pay the defaulted debts because

    A. You owe the money

    B. They could go for a CCJ on the defaults before the 6 years are up

    Pay you debts and stop looking for ways out of them.

    Regarding credit score and ratings - neither are “real” - at least not the ones generated by the CRA’s.

    Lenders will use their own internal scoring/rating system, which is commercially sensitive and not privy to the public.
    • Willing2Learn
    • By Willing2Learn 14th Oct 19, 8:42 AM
    • 4,604 Posts
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    Willing2Learn
    • #9
    • 14th Oct 19, 8:42 AM
    • #9
    • 14th Oct 19, 8:42 AM
    ...Regarding the defaults, it sounds as if there is no benefit to paying them off if they are going to drop off after 6 years anyway so I'll just let leave those. I've just heard conflicting information that if not payed there still may be something showing on my credit files even after the 6 years has passed?

    What's the difference between credit rating and credit score fatbelly?
    Originally posted by Higher
    Defaulted accounts are automatically removed from your credit file(s) six years after the date of default, regardless of whether or not the account has been settled.

    Your credit score can be safely ignored as lenders neither use it nor see it. Lenders score you against their independent criteria and policies using the data held in your file, added to the data you submit in a credit application, added to the data they may already hold on you as an existing or returning customer.
    I work within the voluntary sector, supporting vulnerable people to rebuild their lives.

    I love my job

    • fatbelly
    • By fatbelly 14th Oct 19, 8:48 AM
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    fatbelly
    With a CCJ is there any scope for getting it payed off as a reduced settlement?

    Regarding the defaults, it sounds as if there is no benefit to paying them off if they are going to drop off after 6 years anyway so I'll just let leave those. I've just heard conflicting information that if not payed there still may be something showing on my credit files even after the 6 years has passed?

    What's the difference between credit rating and credit score fatbelly?
    Originally posted by Higher
    Although it sounds counter-intuitive, you may find a creditor will accept a full & final settlement on a ccj. If there is no way to effectively enforce the ccj, and monthly payments will take many years to clear the debt, then they will deal.

    The default entriess won't affect your credit file at all after 6 years and Gary explains the difference between a 'rating' and a 'score'.

    There is a risk that the default creditors may start a court claim before the 6 years is up but in your position (6 months left) I'd keep my head down and if any of them do send a pre-action protocol letter, post on the debt free wannabe forum for advice.
    • PRAISETHESUN
    • By PRAISETHESUN 14th Oct 19, 10:10 AM
    • 1,368 Posts
    • 751 Thanks
    PRAISETHESUN
    Thank you all for your responses.

    I do not think any of the debts are statue barred just yet. Seeing as the defaults have not reached six years.

    I wasn't suggesting I'd stop paying the CCJ, I was just wondering if there was any point in me clearing the debt before the 6 years is up. If I carry on paying the monthly token payments, the CCJ would be nowhere near payed off when it reaches 6 years. But it sounds as though there's no benefit to me paying it off early anyway? With a CCJ is there any scope for getting it payed off as a reduced settlement?

    Regarding the defaults, it sounds as if there is no benefit to paying them off if they are going to drop off after 6 years anyway so I'll just let leave those. I've just heard conflicting information that if not payed there still may be something showing on my credit files even after the 6 years has passed?

    What's the difference between credit rating and credit score fatbelly?
    Originally posted by Higher
    There's no difference between a credit "rating" or "score" - what you really want to ask is the difference between "rating/score" and "history".

    Your credit history is the contents of your credit files dating back over the last 6 years. This is what lenders look at when you make an application. They do not see the "score/rating" numbers provided by any of the CRAs - in fact no-one except for you does, which is why they are meaningless and should be taken with a grain of salt.

    As for the debts, it may be worthwhile writing to the CCJ-lender and asking for a final settlement, to see what they might accept. For the others, be careful as writing to them in this way this will most likely reset the 6 year timer since you would be "acknowledging" the debt as stated above.
    • RelievedSheff
    • By RelievedSheff 14th Oct 19, 11:40 AM
    • 683 Posts
    • 680 Thanks
    RelievedSheff
    If you are the position to be able to pay off the debts then it is morally the right thing to do.

    You borrowed the money in the first instance. It is to some degree irrelevant if they affect your made up credit score or not.

    A satisfied CCJ will be looked upon by lenders far better than an unsatisfied one.
    • Higher
    • By Higher 14th Oct 19, 12:03 PM
    • 16 Posts
    • 0 Thanks
    Higher
    Thanks again all.

    The debt that went for a CCJ was initially from a Lloyd's overdraft but is now being dealt with by a solicitors firm since it became a CCJ and that's who I pay each month. I presume I write to the solicitor company rather than Lloyd's? It's Restons Solicitors the debt is with.

    Is there any issue with me phoning them to discuss a settlement initially rather than writing to them? If I was to agree to anything I'd obviously request this arrangement in writing before making payment.
    • Thrugelmir
    • By Thrugelmir 14th Oct 19, 12:14 PM
    • 65,365 Posts
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    Thrugelmir
    While the debts may ultimately disappear. Finance houses are like elephants. They'll never forget. You'll need to weigh up whether the inconvenience at a future date is worth the risk.
    ““there really is no such thing as ‘the future’, singular. There are only multiple, unforeseeable futures, which will never lose their capacity to take us by surprise.””
    ― Niall Ferguson
    • boo_star
    • By boo_star 14th Oct 19, 12:34 PM
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    boo_star
    While the debts may ultimately disappear. Finance houses are like elephants. They'll never forget. You'll need to weigh up whether the inconvenience at a future date is worth the risk.
    Originally posted by Thrugelmir
    To be fair once it's gone as far as a CCJ then it won't make a difference if you pay it off or not. You'll either be persona non grata or not regardless of what you do.
    • Thrugelmir
    • By Thrugelmir 14th Oct 19, 1:27 PM
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    Thrugelmir
    To be fair once it's gone as far as a CCJ then it won't make a difference if you pay it off or not. You'll either be persona non grata or not regardless of what you do.
    Originally posted by boo_star
    Likewise with other defaulted debts. The Lloyds umbrella extends far and wide.
    ““there really is no such thing as ‘the future’, singular. There are only multiple, unforeseeable futures, which will never lose their capacity to take us by surprise.””
    ― Niall Ferguson
    • boo_star
    • By boo_star 14th Oct 19, 1:35 PM
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    boo_star
    Likewise with other defaulted debts. The Lloyds umbrella extends far and wide.
    Originally posted by Thrugelmir
    Agreed. Once it gets as far as a default then you're likely going to be stuffed regardless.
    • nic_c
    • By nic_c 14th Oct 19, 2:40 PM
    • 2,177 Posts
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    nic_c
    For defaults you haven't paid, then so long as you are able to pay, it's a choice of morality. If you don't pay and they inform you the intention to start legal proceedings by issuing a preprotocol letter you can pay.
    For debts you are paying, like the CCJ, you need to keep paying. As to whether to pay it all off, that is a personal choice. As there are no costs it is effectively an interest free loan so you can carry on paying and putting money into savings - if you are paying the judgment installment they cannot ask you to pay more, but if you are paying less, usually by mutual agreement they could ask for financial statement.

    A reason for paying off could also be what you are aiming to do in future, for instance you don't want to apply for a mortgage and have to provide bank statements showing a regular payment plan with Restons, even after the CCJ has fallen off.
    • Thrugelmir
    • By Thrugelmir 14th Oct 19, 4:35 PM
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    Thrugelmir

    A reason for paying off could also be what you are aiming to do in future, for instance you don't want to apply for a mortgage and have to provide bank statements showing a regular payment plan with Restons, even after the CCJ has fallen off.
    Originally posted by nic_c
    Failure to disclose ongoing financial committments is Fraud. A sure way of finding oneself listed on NHunter.
    ““there really is no such thing as ‘the future’, singular. There are only multiple, unforeseeable futures, which will never lose their capacity to take us by surprise.””
    ― Niall Ferguson
    • Higher
    • By Higher 4th Nov 19, 10:35 PM
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    Higher
    Thanks for all of your advice.

    Since last posting I contacted the organisation dealing with the CCJ and after some negotiations was eventually offered a 50% reduction on the balance to be paid as final settlement. I have one question, before I pay this, is there any way the creditor can set aside the CCJ as such or remove it from my credit file early? Just wondering as if this is possible I may as well ask if they will do this as part of the deal with me paying up.
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