Default Notice
Creditors are entitled to issue a Default Notice if you have missed one or more payments and this will stay on your credit file for six years from the date of issue.
Most personal loan and credit card agreements are regulated by the Consumer Credit Act 2006 and the creditor must issue a Default Notice before commencing legal action. The notice will normally carry with it threats of County Court Judgement or petitions for Bankruptcy.
The Default Notice must include:-
- Name and address of the creditor.
- Type of agreement and the breach thereof.
- Early settlement figure (for fixed sum).
- Steps to be taken by you to remedy the situation.
- What the creditor intends to do should you not comply with the agreement.
The creditor must allow you 7 days to comply with the default notice. Thereafter the creditor may issue a County Court Summons against you. Once judgement is obtained then the creditors may apply for:-
- A Charging Order on your property
- An Attachment of Earnings Order.
- A petition for your bankruptcy.
