If the Court issues a Third Party Debt Order against you it means that your bank will be instructed by the Court to pay your creditor in full or part with funds from your bank account. As such this type of Order can have very serious implications.
Interim Order – Funds in your bank account frozen
Once an Interim Third Party Debt Order is issued and forwarded to your bank the funds in your account on that day up to the amount of the debt owed will be frozen. As such you will not be able to access the money in your account unless the your funds are greater than the total debt you owe.
Funds are not physically taken from your account until the court hearing has taken place and the a full Order has been issued by the court.
BMD Tip: If you think one of your creditors is going to apply for a third party debt order there is nothing to stop you withdrawing money from your bank or savings account in advance of the interim order being made. However you may not know about the order until after it has been made.
Full Order issued and funds taken from your account
If after the Court Hearing a full Third Party Debt Order is issued your bank will be required use the money frozen on the date the Interim Order was issued to pay the balance owing.
Only money that was actually in your bank account at the date when your bank received the copy of the interim order can be used. Money paid into your account at a later date are not affected and cannot be used for the repayment of the debt.
BMD Tip: If your account is overdrawn on the day the third party order is sent to your bank, your creditor won’t get their money as there won’t be enough funds to pay the debt. If money is paid into your account after this date it cannot be used to pay off your debt.
Can you access your cash if an Interim Order is issued?
If your money has been frozen because an interim third party debt order has been made this may cause you hardship because you cannot meet your day-to-day living expenses. If you are in this situation, you can make an application to court for a Hardship Payment Order.
You will need to make the application using a Court form called N244.
When you have completed your N244 form you must take the form to court yourself with written evidence of your hardship. This evidence can include:
– Copies of wage slips
– Bank statements
– Mortgage account details
– Your rent book
– Any other documents which show your financial situation.
If other people in your family will be affected because your money is frozen for example children or an older person living with you, explain on the form how they will be affected. This will help the court to make a fair decision about your situation.
Usually you will have to pay a fee of £40 for this application. However, you might not have to pay the fee at all or it could be reduced because your money has been frozen. Ask the court about this when you take the form in.
A judge will deal with your case on the same day you take the application form in. They can make a hardship payment order which orders the bank to release a certain amount of money to you or to someone else such as your partner. The order will be faxed to the bank and copies will be sent to your creditor.
