Why are all CCJs lumped together as credit risks?

[smalltrader]

HI

New to the forum and first post - looks like a lot of interesting threads here with some great advice.

Anyway, I tried to Google the following but its very difficult because there is so much information on debt related CCJs. Ok, so to my question.....

I have received a small claims court claim which I'm defending. The claim is not for a debt but due to an allegedly faulty product which we're willing to replace but not refund after a long time delay. So this question is, why is it that if I lose this dispute (and obviously I'm hoping not to), then I'd suddenly be labelled as having a CCJ and be unable to get a mortgage for 6 plus years?

I should add, that the amount that the claim is for is tiny (barely more than £100 including costs so far) and _if_ I lose, I'd be in a position to pay it immediately. That said, if I didn't why would this civil dispute potentially cause me difficult getting a mortgage? I can see why in debt-related judgements but I just don't understand why for others?

That example above was all true in my case (unfortunately) but what if someone somehow does something negligant that causes £10million worth of damage that they can't possibly pay and are no insured for that loss. I could see why society might want to punish them for doing whatever they did to act in a negligant way, but why would they immedaitely become a "credit risk" - when what they did had nothing to do with borrowing money and not paying it back.

[Amethyst]

Re: Why are all CCJs lumped together as credit risks?

Good question.

[wales01man]

Re: Why are all CCJs lumped together as credit risks?

Its easy to put them Together problem if they become based on sums involved at what figure does it change into a worse CCJ for credit reference purposes

[Debt Camel]

Re: Why are all CCJs lumped together as credit risks?

hi smalltrader,

You probably know this, but to spell it out, if a CCJ is paid in full within 30 days it is removed from the record and has no effect on your credit file.

why would this civil dispute potentially cause me difficult getting a mortgage? I can see why in debt-related judgements but I just don't understand why for others?

As soon as you lose the case, you do have a debt - you owe the claimant the money awarded.

As a self-respecting and solvent tradesperson, you will of course pay it off straight away But there are plenty of dodgy builders, second hand car salesmen etc who either won't choose to or who can't afford to. Would you want to do business with one of these firms if you could see they had a few unpaid CCJs?

Take your example of a person who somehow end up with a huge CCJ for some negligence. The claimant who has won the case can choose to try to enforce the judgment via making the debtor bankrupt. If you are a mortgage lender, would you want to lend to someone in this position?

[smalltrader]

Re: Why are all CCJs lumped together as credit risks?

Hi DebtCamel

Thanks for taking the time to read and understand my point which you obviously do.

Yes I did realise about the 30 days and the fact that it is a debt. I think I'm nearly agreeing with you. Certainly I agree that you probably wouldn't want to lend to someone who is bankrupt regardless of how he/she/it became bankrupt.

There is still something in me which thinks that there is a difference between someone taking a loan and then not keeping within the loan agreement versus some other dispute that then leads to a debt that must be paid in full almost immediately. As a lender, I think I would find the first case far more worrying. The second case could be something as simple as a tree on the home owner's property falling in s storm causing huge amounts of damage which could go beyond any insurance cover. I don't see why that homeowner should be denied credit for years to come because they didn't know they should get abortionists to regularly inspect the trees on their property !