Question 1

What is the difference between a default and a CCJ?

Accepted Answer

A **default** is a lender's record that an agreement broke down; a **county court judgment (CCJ)** is a **court order** to pay. One is a credit reporting matter, the other is a legal decision with enforcement behind it.

**Default.** Recorded when a lender concludes the relationship has broken down — typically after several missed payments, commonly three to six, following a formal **default notice** giving an opportunity to remedy.

**What follows:** the account is marked defaulted on your credit file; the balance may be sold to a debt purchaser; and **the default stays on your file for six years from the default date**, regardless of whether you subsequently pay it.

**This is the point people most need to understand:** paying a defaulted debt marks it as **satisfied**, which is viewed considerably more favourably, but it does **not** remove the default or restart the six years.

**County court judgment.** A creditor has taken court action and obtained a judgment requiring payment.

**What follows:** it is recorded on the **Register of Judgments, Orders and Fines**, publicly searchable, and on your credit file for **six years**.

**The crucial exception:** pay in full **within one month** of the judgment and it is **removed from the register entirely**, as though it had never been made. Pay later and it is marked **satisfied** but remains for the full six years. **That one-month window is worth a great deal** and is widely unknown.

**Enforcement powers** follow a CCJ — enforcement agents, attachment of earnings, charging orders against property, and third party debt orders. A default carries no such powers without further court action.

**A judgment can be set aside** where you did not receive the claim or have a genuine defence, and this must be applied for promptly.

**Judgments are frequently obtained by default** because the debtor did not respond to the claim form — sometimes because it went to an old address. **Ignoring a claim form does not make it go away**; it guarantees the judgment.

**Both affect borrowing substantially**, and their effect diminishes over the six years.

General information, not legal or financial advice.

Question 2

What is statute barred debt?

Accepted Answer

Debt that has become unenforceable through the courts because the creditor left it too long — and it is a genuinely important protection that is widely misunderstood in both directions. The

Question 3

What is the difference between a debt management plan, an IVA and bankruptcy?

Accepted Answer

Three responses to unmanageable debt, differing in whether they are legally binding, whether debt is written off, and what they cost you. Debt management plan (DMP). An informal arrangement to pay

Question 4

What is a joint account, and what are the risks?

Accepted Answer

An account held by two or more people with equal rights over the whole balance — and that phrase is doing more work than most holders realise, because each person can generally withdraw everything

Question 5

What is a guarantor loan, and what is the risk to the guarantor?

Accepted Answer

A loan where a second person legally agrees to repay if the borrower does not — and the risk to the guarantor is far greater than most guarantors understand when signing. How it works. A borrower

Question 6

What is the difference between available balance and cleared balance?

Accepted Answer

Your cleared balance is money that has fully settled in the account. Your available balance is what you can actually spend right now. They differ because payments do not move instantly, and the gap

Question 7

Why are there three credit reference agencies?

Accepted Answer

Because they are competing commercial companies, not a public register. In the UK the three main ones are Experian, Equifax and TransUnion, and each maintains its own separate database. Why this

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