You are most likely to get CCJ which is county court judgment if an individual seeks court help against you and legal actions are taken. The reason behind such an action is a delay in payment that you might owe them. In the case, you find yourself in a situation that depicts that you are unable to clear the debt or you show unwillingness, you are in big trouble. Are you still unsure of what is CCJ?
No need to worry anymore as we have covered the basics about everything that you need to know about CCJ and how it might affect a company and the director. Before realising the responsibilities as a director during CCJ, let’s begin with the introductory explanation of CCJ.
What Is CCJ (County Court Judgement)
In case a creditor is not able to get the amount of debt from another business owner, they have the right to reach out to County Court Judgement (CCJ) for help. Regardless of the reason whether the owner does not have enough amount of money to clear the debts or he is simply unwilling to clear the debt payments.
Do you still seek help to know more about what is CCJ to be exact? CCJ is the abbreviation of County Court Judgement. This is usually the last step to seek official help when a debt is not cleared or the other party is not willing to clear it. So if CCJ reaches out to you, you can not assume that this is happening out of blue, you should rather be checking your debt payments. Before a creditor seeks help from CCJ, they usually send a final warning letter that explains all the details of the money you owe them. Along with the warning that they will take legal action against you.
How Does CCJ Affect the Company Director?
A company instantly faces low credit ratings when it gets a CCJ. To keep your credit file safe from being affected, you should vigilantly seek ways to guarantee as a director of the company. In the case that your banking and business banking sources are the same, this will instantly disturb your personal borrowing capacity as well. Also, this will affect your mortgage, credit cards, and overdrafts.
Moreover, your income will be under doubt by unreliable sources and that can cause further troubles for your personal dealings with the bank.
What Are The Responsibilities Of A Director During CCJ?
When a company receives the county court summons, the first need is to respond within two weeks. However, you have a chance to extend this time duration by buying two more weeks to respond well. Some other responsibilities as a director of the company are listed and explained below for you:
- You should respond within the given time and if you are unsuccessful to make negotiations with the creditors, there will be the issuance of CCJ for your company to go against the law.
- There will be a guarantee of the validity of the debt before the process begins.
- You need to realise the time duration of one month to clear the full amount of debts after you receive the CCJ.
- If you are unable to make the payments, the credit agencies will be informed to take action against you and the official registration of the CCJ will be done by the court.
- You will prove the other party right by not making the payments cleared on time and your company will be considered in an unstable position. This means that your business is unable to clear the dues that it owes to others.
- You do realise that this is a horrific position to be in, this can further lead to the winding-up of petition issuance.
The Bottom Line
Now that you have gathered a fair amount of information about what is CCJ, we can bring the discussion towards wrapping up finally. We all have realised by now that the experience of struggling with CCJ can be quite daunting. It is suggested to take serious and quick measures to save your business position from further damage.
It is better to quickly seek professional help or speak to your accountant to sort out the issues as swiftly as possible. We hope these few minutes of reading will help you to make the right decisions about saving your business from any cause of damage.
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Disclaimer: The information about what is CCJ provided in this article including text and graphics is general in nature. It does not intend to disregard any of the professional advice.