Attachment Of Earnings
In the debt-recovery process, a county court judgement (CCJ) is one of the final steps, and it will probably not come as an unpleasant surprise, because it will have been preceded by numerous phone calls and letters from your creditor. It will also become part of your credit history, even after the debt has been paid.
Note that if you have a CCJ with a creditor and have not paid it, that creditor may petition the court to obtain an Attachment of Earnings Order. When the order is approved, your employer will be required to deduct that amount from your wages in order to pay the judgement, and whenever they do this, they have the right to deduct £1 for administrative costs.
An Attachment of Earnings Order is a request for payment determined by the county court if you owe your creditor more than £50, and it will remain in effect until the debt is fully satisfied. It will be granted to a creditor and presented to the debtor’s employer when prior payment agreements have been unsuccessful in satisfying the debt.
What The Recipient Should Know
You must complete the N56 form you receive from the court, being sure to include any payments you owe to other creditors, a repayment plan that you feel is affordable for you, and a list of your income and expenses. Then, the employer will deduct the payment from your wages and submit it to the court. If you fail to return the completed form, even after receiving an additional order from the court, you can be imprisoned for as much as two weeks. Also, if your creditor is able to contact your employer directly, they can have them provide all the necessary details for their records.
If the court feels that your continued employment may jeopardized if your employer is informed about your original Earnings Order, they may replace it with a Suspended Attachment of Earnings Order. This will oblige you to make your payments directly to the court, which is acting on behalf of your creditor, and if you fail to do so at any time, your original Earnings Order will take effect once again.
What The Recipient Should Do
If you do not agree with your Earnings Order, write to the court, explain why you disagree, and retain a copy of the letter. Once it is received, you will be given a date to be present in court to plead you case while providing the relevant documents and details of your finances in order to back up your claim. If you change jobs, the Attachment of Earnings Order will still be active, and if you fail to notify the court of what has taken place, you will be committing a criminal offence resulting in a prison sentence or a fine.
When your circumstances change in any while your Attachment of Earnings Order is in effect, you will need to submit a completed Form N244 if you want to have any of the terms altered. As a rule, a fee of £65 applies when the form is submitted, but it may also be waived when certain circumstances apply.