Judgements with an applicable 8% interest rate, is that a RIP off rate?
When a creditor fails to get paid by a debtor, he has two choices.
Write it off or obtain a Judgement against the debtor.
Statistically many judgements are granted because a debtor fails to enter an Appearance in either the Circuit Court or the High Court. The consequences, there is no actual Court hearing, the court staff complete the paperwork in the relevant court office on behalf of the Creditor.
The creditor has 12 years to execute the judgement, sometimes Judgements are registered against family homes.
But that’s not all, from the date the judgement is granted a rate of interest at 8% pa is applied to the value of the judgement. That is twice the average home loan rate and with the ECB refinancing rate at 0.05% the 8 % rate applied to Judgements is a whopping 160 times higher, so would you agree, is that a RIP off rate?
I am calling on the Government to do whatever it has to do to amend this penal rate of interest applied to Judgements. The 8% rate was set when Inflation was much higher and 8% protected the capital value, but with interest rates so low, this 8% rate makes super profits for banks, where would you get a return like 8% in today’s market?