The Difference Between CCJs and Defaults

When it comes to credit scores, County Court Judgments (CCJs) and defaults are two of the most common negative marks that can affect your credit rating. Here’s what you need to know about the difference between the two:

County Court Judgments (CCJs)

A CCJ is a court order that can be issued against you if you fail to repay a debt. It is a legal action taken by a creditor to recover the money they are owed. Once a CCJ is issued, it will appear on your credit report for six years, even if you pay the debt in full. This can make it difficult to obtain credit in the future.

Defaults

A default is a notice that a lender or creditor sends to the borrower when they have failed to maintain the agreed monthly payments on an agreement or failed to meet a deadline for repayment. Defaults can also appear on your credit report for six years, even if you pay the debt in full. Defaults can make it difficult to obtain credit in the future, but they are generally considered less severe than CCJs.

Here are some of the key differences between CCJs and defaults:

1.      Legal Action: CCJs are a legal action taken by a creditor to recover the money they are owed, while defaults are a notice sent by a lender or creditor to the borrower.

2.      Credit Report: Both CCJs and defaults can appear on your credit report for six years, even if you pay the debt in full.

3.      Severity: CCJs are generally considered more severe than defaults, as they are a legal action taken against you.

4.      Impact on Credit Score: Both CCJs and defaults can negatively impact your credit score and make it difficult to obtain credit in the future.

If you have a CCJ or default on your credit report, it’s important to take steps to improve your credit score. This can include paying off any outstanding debts, making sure you pay all your bills on time, and checking your credit report regularly to make sure there are no errors.

In conclusion, CCJs and defaults are two of the most common negative marks that can affect your credit rating. While both can make it difficult to obtain credit in the future, CCJs are generally considered more severe than defaults. If you have a CCJ or default on your credit report, it’s important to take steps to improve your credit score and increase your chances of obtaining credit in the future.

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