Third Party Debt Order: Frozen Bank Account and What to Do

What is a third party debt order?

A TPDO is a way for a creditor to enforce a judgment. Instead of asking you to pay, the creditor asks the court to order a third party that holds money for you, usually your bank or building society, to pay it to them. It can also reach other lump sums you are owed, such as a redundancy payment or an insurance payout.

It only applies where a court has already made a judgment or order and you have not kept to it. The creditor can take only enough to clear the debt. If you are not sure how you got here, our guide to county court judgments explains the earlier stages, and the attachment of earnings guide covers the equivalent route for wages.

The two stages

What is and is not taken

• The order applies to the balance in the account on the date the bank receives the interim order
• Money paid in after the bank receives it is not affected
• If the account is overdrawn when the order arrives, the creditor gets nothing from that account
• The creditor can only take enough to clear the judgment debt and costs

If the freeze leaves you without money

If you cannot pay for essentials such as food, rent or bills because the account is frozen, you can apply to the court for a hardship payment order. You use form N244 and send evidence such as payslips and bank statements. A judge can decide on the day you file. The fee may be reduced or waived, so ask the court.

While you wait, tell your bank you are applying and ask about any basic account or other way to get your wages paid. Do not move money out of the frozen account, as that can cause further problems.

Reasons you can give for objecting

The interim order becomes final unless you show good reasons it should not. Reasons listed by Citizens Advice include:

• The account is joint and the other holder does not owe the debt
• The money belongs to someone else, for example you hold it for another person
• The debt is small and could be repaid by instalments
• The order would cause serious hardship to you or your family
• The account is overdrawn
• For a building society or credit union account, it would leave you with less than £1

Protect yourself before it happens

If you have a judgment against you, you cannot completely prevent a TPDO, but you can reduce the risk. Keep to any payment arrangement the court or creditor has agreed, because missed payments invite enforcement. Tell the creditor if your circumstances change. Consider whether you hold more money in your main account than you need, and talk to an adviser rather than moving money around in a hurry, which can look like trying to avoid the debt and may make matters worse.

Joint accounts and other people's money

If the frozen account is shared, the other holder may not owe the debt and can object. If money in your account belongs to someone else, such as a child's savings, a family member's funds or money held for an organisation, tell the court and provide evidence. Courts take these objections seriously, but they need proof such as account statements or a written declaration.

How it differs from other enforcement

A TPDO targets money in the bank. A charging order secures the debt against property, and bailiffs target goods. A creditor may try more than one route, so a frozen account is a signal to deal with the whole judgment rather than just the account.

What to do now

1. Check the court papers and note the hearing date
2. Get the interim order and read what it says you owe
3. Apply for a hardship payment order if you cannot pay for essentials
4. Contact the creditor, ideally through an adviser, to offer a payment arrangement
5. Attend the hearing and bring evidence of your income and costs