The number of county court judgments (CCJs) against consumers in England and Wales has increased more than 20 per cent to over 209,000.
The increase, in the first quarter of 2015 compared to a year ago, emerged in figures from the Registry Trust – a non-profit organisation that collects CCJ and high court data.
There has not been more than 200,000 consumer CCJs in the first quarter of the year since 2008.
While many people are struggling with unmanageable debt, the average value of a CCJ in the three months to March (£2,171) fell for the sixth consecutive year.
This average value is 41 per cent down on the same period in 2009, the recent high point.
The total value of all debt judgments against consumers in the first quarter was £514m, to which CCJs contributed £455m.
Introducing the statistics, Malcolm Hurlston, who chairs the Registry Trust, pointed out that a higher proportion of consumer debt was now in the hands of debt buyers rather than the originating lenders.
He said the increase in numbers resulted largely from a different business model and not from a general deterioration in the experience of consumers. For this reason, he explained, there was no inconsistency between the fall of personal insolvencies in the first quarter and the rise of CCJs.
Hurlston added: “In the end recording unmanaged debts through CCJs plays a key role in ensuring that credit ends up in the right hands. The greater danger to consumers lies from unrecorded debt.”
Affected by different trends, the number of first quarter high court judgments (HCJs) against consumers fell sharply.
But the total value increased 27 per cent to £58.7m, reflected in an average HCJ value of £827,282, over four times higher than in the first quarter of 2014.
In England and Wales the Registry Trust runs the Register of Judgments, Orders and Fines for the Ministry of Justice; this register includes both CCJs and high court information.
By Marcel LeGouais