CCJ’s filling the court rooms
For the first time in 14 years the amount of County Court Judgments in England and Wales has increased. Through the Nineties the numbers of CCJs fell as economy improved, but now with attitudes towards debt changing, numbers are increasing again.
In 2005 the number of people being brought before the judge for bad debts rose seven percent to 573,321 cases. This was partly due to Driver and Vehicle Licensing Authority getting tough on non road tax payers, a total of 18,000 judgements a month for failing to pay road tax accumulating to 216,000 cases through the year.
The reasons behind the increase in CCJs are thought to be due to an increase in large loans, mortgages and credit card bills which people take out, in stark contrast the number of contract CCJs against businesses or firms has dropped by 6 percent to 154,785.
The Registry Trust, a public interest company founded in 1985 to run the registry of CCJs, whom released these figures, state that: ‘The rise in CCJs provides further evidence of difficulties in the personal lending sector’. It shows that lenders are increasingly prepared to use the courts to recover bad debts which places the CCJ as a key element to a healthy, responsible credit industry.
For many lenders a CCJ is used as a last resort in order to try to recover debt, so this rise shows that bad debt is on the increase again. The amount owed by people is also increasing as they take on bigger loans, spend more on credit cards and are tempted to overstretch themselves with big mortgages.
Another trend which has fuelled the sudden increase is a tendency to resort to bankruptcy, forcing lenders to turn to the courts to get a settlement. According to the Consumer Credit Counselling Service, Britain’s leading debt charity, the average unsecured debt of someone seeking their help has risen from around £28,000 last year to more then £30,000 now.
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