Hi --- Initially before the Nationwide can do anything they have to obtain that CCJ against you by going through the due legal process, of which you have the right to either make a satisfactory arrangement to pay within one month to stop this going on your credit record for 6 years, or dispute / defend the case. What you have been sent is a standard letter that could be applicable after a judgement is made against you, if you do not adhere to the terms of any CCJ made against you and have to face further action, for not complying with the terms of that original order.
They will not apply at this early stage to either send in bailiffs, apply for your personal bankruptcy or try to register a charge against your property, neither would the court permit this so early on. If you fail to come to an agreement or fail to keep up to an arrangement or any order made at the initial court hearing, then your creditors can apply at a later day for an enforcement order by the courts on the grounds that you have failed to honour that initial judgement. If you are unable to pay the amount specified then you should ask the courts to "vary" the order by completing a form N245, obtainable from the court.
It is at this time when the courts have the power and discretion to consider which action is the most appropriate against you, after taking account both sides of the case, however they do have the discretion to order any of the above sanctions depending on your circumstances and which action is applied for by the creditor.
I enclose an article from UK insolvency helpline, you can call them free for advice which I strongly urge, or see an advisor at your local CAB if you are struggling to settle or come to an agreement, before it goes in front of a court.