# Court Procedure For Loan Defaulters



## Peter54 (3 Apr 2010)

Could someone be kind enough to explain the court procedure for people who are having difficulty paying back credit cards and personal loans.  

What court are such cases held in and is it open to the public?  Does the bank ask the judge to place a judgment on the home of the person who has defaulted due to unemployment etc.  Are Judges lenient on borrowers who are paying as much as the possibly can.

Apologies for all the questions - just looking to get a handle on how this situation is handled.

Many thanks.


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## bond-007 (3 Apr 2010)

Peter, I assume this is about your matter with AIB credit cards?

I take it is an amount exceeding €6350 and under €38100?

The procedures are very different depending on the amount. Have you had any legal papers yet?


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## Peter54 (3 Apr 2010)

Hi Bond-007, yes the debt exceeds 6350 but is well below 31800.  I have received no legal papers as yet but am still making payments.


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## bond-007 (3 Apr 2010)

Ok, so you will be dealt with by the circuit court. 

The first step is a *civil bill* which will be sent to you by registered post. You have 2 options at this point depending on whether you wish to defend the case or not. If don't wish to defend the case, simply do nothing and they will get a default judgement without a hearing. If you want to defend you will need to enter an appearance within 10 days of receiving the civil bill and then enter a defence within a further 14 days. If you do this the matter will be scheduled for trial in front of a judge in the circuit court. This is open to the public. Note if you loose the costs will increase. There is really no point defending if you do owe the money. 



> Does the bank ask the judge to place a judgment on the home of the  person who has defaulted due to unemployment etc.


The bank once it has obtained a judgement against you can place a judgement mortgage on any property you own in your own name or jointly in your name. The bank does not need to obtain the consent of the judge or inform you of their intention to place a judgement mortgage on your house. Being unemployed does not enter into it. All the bank does in this situation is they get a solicitor to swear an affidavit and they lodge this with The Property Registration Authority, who register the judgement mortgage against your property. They will inform you in writing if the bank does this.



> Are Judges lenient on borrowers who are paying as much as the possibly  can.


At the circuit court stage the judge is only concerned with do you owe the money. So defending on the basis of being unemployed etc is really a waste of time and money.
After they obtain judgement in the circuit court AIB will most likely take you to the District Court to get an instalment order. A district judge will be more sympathetic to an unemployed debtor making some payments and will deal with you accordingly.

Keep asking questions if you need to know more information.


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## ajapale (3 Apr 2010)

Thread moved from* Askaboutlaw *-(For legal issues not covered elsewhere)  to Banking,  borrowing, budgeting and credit cards which is where these issues are discussed on AAM.


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## Peter54 (6 Apr 2010)

Thanks a million Bond.  Does the Sheriff only get involved if I default on the installment order?


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## bond-007 (6 Apr 2010)

No.

The sheriff is normally involved between getting the judgement and the bank obtaining the instalment order. It is usually the opening gambit after obtaining judgement. I wouldn't worry too much as the sheriff rarely if ever will take anything form a private residence. Unless you have a big sports car that is not on finance or you have a Monet hanging on your wall, I would not worry.

If you default on an instalment order, the bank can summons you to court for a committal hearing. If you can't pay due to your circumstances you will not go to prison. Prison is for those that won't pay deliberately. Also you are entitled to legal aid if the matter gets as far as a committal.


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## Wishes (7 Apr 2010)

If this goes to court I'm presuming the lack of correspondence from AIB to the OP could possibly go in his favor.


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## bond-007 (7 Apr 2010)

Of course, but the OP would have to defend the case. As I said earlier defending is a double edged sword.


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## Peter54 (7 Apr 2010)

Hi Bond, does the AIB have to inform me they have contacted the sheriffs office or is this automatically done after I have received the registered letter.


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## bond-007 (7 Apr 2010)

No. 

The sheriff will contact you when he has received the decree from AIB.


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## Wishes (7 Apr 2010)

bond-007 said:


> Of course, but the OP would have to defend the case. As I said earlier defending is a double edged sword.



That's true too.

I'm really interested in the outcome of this case.  Having spoken to one or two institutions; who all said they only go to court / obtain judgments in cases were the debtor is refusing to pay or is not communicating.  It is a last resort so to speak.  It seems to me the OP is paying something and communicating.


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## Shuttleworth (22 Jul 2010)

Wishes said:


> That's true too.
> 
> I'm really interested in the outcome of this case. Having spoken to one or two institutions; who all said they only go to court / obtain judgments in cases were the debtor is refusing to pay or is not communicating. It is a last resort so to speak. It seems to me the OP is paying something and communicating.


 
The financial institutions are lying through their teeth.  It doesn't matter what communication you are engaging in or paying them, over the last couple of months they are throwing the book at everybody.


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## kenny shaw (24 Jul 2010)

if a judgement is registered against your property maybe your partner could remortgage the property and assume sole ownership of your home. I would imagine she has a right to your half of property,hence removing judgement


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## Moral Ethos (24 Jul 2010)

Nope. Any changes to the property will need the JM to be paid.


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