If you have a CCJ, it will be cancelled and the debt written off if you go bankrupt. However the record will remain on your credit file.
Included in this article:
- What happens to a CCJ if you go bankrupt?
- Can the CCJ record be removed from your credit file?
- Can the creditor still take action against you?
Want help to go bankrupt? Give us a call (0800 077 6180) or complete the form below. The advice is free and confidential
What happens to a CCJ if you go bankrupt?
One or more of your creditors may have issued a CCJ (Country Court Judgment) against you. If so, you don’t need to worry. These debts are still written off if you go bankrupt.
Although the CCJ is a Court order to pay the debt owed, the fact you have gone bankrupt overturns this. The order is no longer valid. The debt will be dealt with by the official receiver in the same way as any other that you owe.
Once you are bankrupt, you should stop making any payments towards the CCJ direct to the creditor or any collector acting on their behalf.
The Official Receiver will write to the creditor and inform them of the situation. If you are contacted in the mean time, you simply need to explain that you are now bankrupt. You can also give them your reference number. They will be able to check this on the Insolvency Register.
Struggling to get your head round all of this? We can help. Call us (0800 077 6180) or complete the form below. The advice is free and confidential.
Can the CCJ record be removed from your credit file?
When a CCJ is issued against you, it is recorded on your credit file. This has a significant negative impact on your credit score.
The record will remain on your file for 6 years regardless of whether you actually pay off the debt any sooner. The fact you have gone bankrupt and the debt has been written off makes no difference. The record of the Judgment will only be removed from your file 6 years after it was added.
That said, this situation doesn’t usually matter. Remember, the fact you are bankrupt also negatively affects your credit score for 6 years.
In almost all cases, the start date of your bankruptcy will be after the date your CCJ was issued. Given this, by the time the record of bankruptcy is removed, the record of the Judgment will also have disappeared. Your credit file will then be clear.
It is rare but possible for a CCJ to be issued against you after the date you go bankrupt. If this happens the record will remain on your credit file after the record of your bankruptcy has been removed.
Can the creditor still take action against you?
After a CCJ is issued against you, the associated creditor still has the option to take further action against you. They can apply to the Court for an attachment of earnings or, if you are a home owner, a charge against your property.
Not all banks will take this kind of action. However it is common for business loan companies and debt purchasing companies to do so.
Once you are bankrupt, you are protected. All of the creditors included in the process are now barred from taking further enforcement action against you. The options are no longer available. If an application was made, it would be rejected by the Court.
One or more of your creditors may have already instructed a bailiff to visit your home. Even they have to stop from the day you go bankrupt.
It is very important to understand that once a Charge is issued against your home, the debt becomes secured. If you subsequently go bankrupt, it can’t be included and will not be written off. For this reason, if you believe one of your creditors is planning to apply for a charge, you should call us immediately for more advice.
Need assistance to go bankrupt? Give us a call (0800 077 6180) or complete the form below.
Arrange a call with a Bankruptcy Expert
Privacy Policy
Your information will be held in strictest confidence and used to contact you by our internal team only. We will never share your details with any third party without your permission.
Hi, I made myself bankrupt in Sept 2017, but recently got a debt collection agency letter chasing payments for a debt i got a CCJ for back in 1998. I didnt list this on my application for bankrupty, as didnt even remember I had this debt (CCJ) from 1998, what can I tell the debt collection agency please?
Hi Beverley
All of the unsecured debt you owed on the date you went bankrupt in 2017 is included regardless of whether you were aware of it and listed it on your application or not. As such, this CCJ is included in your original bankruptcy and you are not liable to pay it.
You should confirm to the collections company the date you went bankrupt and your bankruptcy reference number (BKTXXXXXX).
You should also explain to them that they will not be able to confirm your bankruptcy on the insolvency register as your details will no longer be listed (they are deleted 3 months after discharge). Ideally forward them a copy of your bankruptcy order if you have one.
If they still persist, the only option is to contact the official receiver’s office that dealt with your case and escalate to the problem to them. They should take action on your behalf and write to the debt collector / creditor informing them that the debt is included in your bankruptcy and can no longer be enforced.
Good Afternoon James
Thank you so much, that’s a weight of my mind, really appreciate your help.
Kind regards
Beverly
Hi,
Great article and very informative, thank you.
You state that “It is rare but possible for a CCJ to be issued against you after the date you go bankrupt. If this happens the record will remain on your credit file after the record of your bankruptcy has been removed.” Sadly, I am one of those rare cases.
Logically, I cannot make sense of this – how a judgement can be made against a debt that has been wiped out? Accordingly, if a CCJ has been made against a zero debt, surely that should be deemed an error and can, therefore, be removed?
Best wishes,
Rob
Hi Rob
You are right about the logic. Legally, the Court can’t issue a CCJ against a debt which is already included in a bankruptcy. According to the Insolvency Act, once an individual is bankrupt, no further legal action can be taken by their creditors to enforce the payment of included debt.
However, what often happens is that a CCJ is issued subsequent to the bankruptcy order because the issuing Court is not aware of the bankruptcy when they approve the Judgment.
Why the Court doesn’t do better checks I have no idea, but this issue can happen.
In terms of removing the CCJ, again your logic is correct. Given it was issued in error, it should be possible to remove it. The issue is getting to the right people, and how much time and effort you are prepared to put in to get it done. If you have the time and energy to fight it, I believe that eventually you should be successful. But if you don’t, simply waiting for it to drop off your file after 6 years is the alternative.
The creditor certainly can’t enforce the debt after the CCJ is issued so there is nothing to worry about there. If they were to try, a quick escalation to the OR would sort it out.