Ruling brings warning for credit card borrowers

11/05/2009

Brits struggling with credit card debt have been warned to avoid deals promising to write-off outstanding balances, following a new court ruling.

Judge Derek Halbert placed 100,000 such cases on hold last week, meaning that borrowers must continue repaying debts until a ruling is passed.

In a letter outlining his intentions, the head civil judge for Cheshire, explained: "The consensus is that the appropriate course is to refer a few carefully selected cases to the Commercial Court in London on a test basis... and then stay all others until the test cases have established the requisite principles."

A deadline for the test cases has yet to be set, but it is hoped that they will set up the fairest way of dealing with court claims from debt management companies looking to cancel out credit card debts.

Daniella Lipszyc, a solicitor at law firm Ultimate Law, told the Times that borrowers should take this in to consideration when seeking out debt management assistance.

"It's now extremely inappropriate and misleading for any company to promise to write-off balances in light of this judicial move," she said.

Tags; Debt Management and Banking,

Regional Debt Advice; Debt Help Cheshire, Debt Help London,

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