CCJs Explained: Definition, How to Handle Them + More Tips
Last Updated: March 10, 2023
A CCJ can pose a serious financial issue, but you may not be aware of what a CCJ is and how you can protect yourself from the problems associated with it.
This article will explain what a CCJ is, what it contains, and what its consequences are. You will also learn how a CCJ affects your credit report and how you can pay it off or avoid getting one in the first place!
What Is a CCJ?
County Court Judgements are court-issued notices that let you know that you owe a certain amount of debt and that you need to repay it. Once you receive the CCJ, you become a Defendant and you have an obligation to the court and to the creditor to whom you owe the money.
You can either admit to the claim or refute it if you disagree with the fact that you owe the amount of money stipulated in the CCJ.
What Happens Before a County Court Judgement Is Issued?
Before you get your CCJ in the mail, you should receive a letter of claim, in which the creditor must try to reach an agreement before proceeding with court action.
You must respond within 30 days of receiving the letter before the creditor proceeds with a warning letter or a default notice. The Consumer Credit Act stipulates that you must be sent a default notice at least 14 days before the creditor takes any action.
You can take this time to repay the debt. If you don’t respond to the notice or you didn’t manage to reach an agreement with the creditor, a CCJ claim form will be issued.
|DID YOU KNOW? The monthly payments can be reduced if you prove that you can’t meet the payments towards the County Court Judgement issued against you; this is known as redetermination.|
What’s in a CCJ?
The County Court Summons will arrive via post and it must contain the following information:
- How much you owe
- The amount you need to pay
- A judgement forthwith – pay off the amount in full
- A judgement by instalments – pay off over time
- The payment deadline
- The creditor’s information
Besides this information, a CCJ should come with the following four forms attached:
- N1 – Claim form
- N9 – Response pack
- N9A – Admission
- N9B – Defence and counterclaim
All CCJs and all accompanying forms should contain the name of the court, your name, the creditor’s name and their account number (or debt reference number), as well as the ‘claim number’ that identifies your case.
The N1 form has a section titled ‘Particulars of Claim’ that explains what the debt entails and how much you owe.
If the letter you receive doesn’t contain all the aforementioned documents, you should contact the court or the creditors that have sent them to you.
|DID YOU KNOW? If you want to conduct a CCJ check, you need to contact one of the three credit agencies in the UK – Experian, Equifax, or TransUnion and ask for your credit report.|
So You Got a CCJ – What Now?
Once you’ve received a CCJ, there are several courses of action you can take.
Vary the Judgement
In case you cannot afford to pay back the amount the court has determined, you can apply to have the terms of the CCJ changed, i.e. vary the judgement. If you have a valid reason, the court can allow you to pay it in instalments or repay it over a longer period of time.
Pay It Back
The CCJ definition clearly states that the information will show up on your credit report. That’s why the best thing you can do is repay the full amount you owe within a month of receiving the CCJ. However, if you can’t afford to do this, you should pay in monthly instalments – a better choice than not paying it at all.
Pay Within a Month
If you pay within a month, the CCJ will be removed from the register and it won’t show up on future credit checks. When you’ve paid the full amount in the first month, you need to apply for a certificate of cancellation, ensuring a CCJ removal.
Pay After a Month
If you repay the full amount of the CCJ after a month has passed, the judgement will be marked as satisfied. Although it will still be visible on the register, people will be able to see that you’ve paid the total amount. After you’ve paid, you need to apply for a certificate of satisfaction, the court’s confirmation of your payment.
Have the Judgement Cancelled
If you don’t agree with the court’s decision that you owe money, or you don’t agree with the amount owed as listed in the CCJ, you can proceed by filing a defence. The CCJ meaning also becomes irrelevant if you didn’t receive the original claim from the court, notifying you of your debt, or you’ve already repaid your debt before you received the CCJ.
Rebuild Your Credit Rating
It’s of the utmost importance that you work on rebuilding your credit rating after receiving a CCJ. Make each CCJ repayment on time, as well as all other loan repayments. It’s a good idea to register on the electoral roll at your current address, and don’t submit too many credit applications.
How to Pay a CCJ
There are two ways you can go about paying your CCJ; you can pay in full or in instalments.
Option 1: Pay the Full Amount
The best course of action is to pay the full amount of the CCJ at once. You need to pay the business or person to whom you owe the money directly, or pay their solicitor if they prefer it. Be careful not to pay the court by accident! It’s a good idea to have proof of payment, so the best payment method is a bank transfer; posting a cheque is always an option too.
Option 2: Pay in Instalments
If you decided on paying the CCJ in instalments and you’re wondering how to pay a CCJ with no paperwork, you should consult your creditor as to the best way to make the repayments. You can set up a Direct Debit payment or create a standing order at your bank, so the monthly instalment will be automatically paid.
|DID YOU KNOW? If you have trouble making your payments, you can supplement your income by utilising one of the numerous strategies for earning passive income. This can be a great way to get you out of debt and even accumulate some savings.|
What Happens if a CCJ Is Left Unpaid?
If you can’t afford to pay off your CCJ, you may be thinking what happens if I ignore a CCJ? Well, you should know that ignoring a CCJ is never a good idea!
If you don’t respond to the CCJ you will receive a judgment in default that finds you guilty even if you don’t respond to the summons and you don’t appear in court. If you don’t start making regular payments once the judgement has been enforced, you can face more serious consequences.
If you don’t meet your payments creditors can apply to the court for a bailiff to collect the debt. So, what is a CCJ bailiff action? If the court gives its permission, it will issue a Warrant of Control that gives the bailiff power to visit your home or your business and seize goods that can be sold to repay the debt. If this happens, you can ask the court to suspend the warrant and allow you to pay off the debt at an affordable rate.
Attachment of Earnings Order
When looking for the best ways how to pay CCJ without much hassle, keep in mind that the court may issue an Attachment of Earnings Order. This allows creditors to deduct the payments from your wages.
Creditors can ask for a Charging Order, which allows for any property you own to be secured against the debt. The debt can be paid off when the property is sold or remortgaged; the last resort is a forced sale of your property to reclaim the money. However, this is unlikely if the property is your main home and you have dependents living there.
|DID YOU KNOW? Secured loans are more likely to be approved than unsecured ones, but they entail more risk since the secured possessions can be seized.|
How Long Does a CCJ Stay on Your Credit File?
Once a CCJ is issued, it will be added to the Register of Judgements, which is a public database containing all the issued County Court Judgements from the past six years. If you’ve paid off your CCJ immediately (or within a month) after it was issued, it won’t appear on the Register. It also won’t be added to your credit report, although the missed payments that lead to the CCJ will still be shown on the report.
Having a CCJ on your report can lower your credit score, and it can affect the likelihood of your being approved for a loan or a credit card. It may even influence your possibility of employment and renting property.
How Long Does a CCJ Last?
When recorded, the CCJ will remain on your record for six years, and since the register is public, anyone can access it for a small fee and obtain this information. Even if you pay off the CCJ in its entirety, it will stay on your credit report for six years, although it will be marked as ‘satisfied’. However, even if you don’t manage to pay it off in the six-year period, the CCJ will be deleted from your credit record.
How to Get a CCJ Removed From Your Credit File
A CCJ can be removed from your file in the following four situations:
- You paid the full amount of the CCJ within a month of its issuing.
- You disputed the CCJ and had it cancelled by the court.
- An insurance company was responsible for the debt listed in the CCJ.
- Six years have passed since the issuing of the CCJ.
Once you have the necessary evidence to have the CCJ removed, you can contact one of the three credit reference agencies and they will delete it from your file.
Now that you know how long do CCJs last, you can check your file to see whether the CCJ has been removed; in case you find that you do have a CCJ you’re not aware of, you need to identify the case number and get in touch with the court that issued it to clear up the situation.
After six years, no one will be able to see the CCJ on your file and your credit score should see a significant rise.
|DID YOU KNOW? Ignoring a court order in the UK can lead you to be held in contempt of the court, which could result in enforcement orders, fines, and even imprisonment.|
Can You Get a Mortgage With a CCJ?
A CCJ on your credit file can seriously affect the possibility of your being approved for a mortgage, as well as getting approved for other loans. Lenders have access to your credit file and they can see the CCJ, as well as all your financial decisions that have led to it.
However, getting a mortgage with a CCJ is not impossible; if the lender sees that you are making timely payments towards your CCJ and working to get rid of your debt, you have a better chance of being approved. The CCJ’s meaning for your mortgage can also be altered by the age of the CCJ – the older the CCJ, the better are your chances of getting a mortgage. If you have a repayment plan in place, that’s an additional plus with the lenders.
|DID YOU KNOW? Before you apply for a mortgage, you need to acquaint yourself with the different types of mortgages available and familiarise yourself with the process of getting a mortgage. Keep in mind that you need to be permanently employed and that you’ll have to provide proof of income.|
How to Avoid Getting a CCJ
Once you’ve learned what is a CCJ for UK residents and what it entails, you’ve probably figured out that the best thing you can do is avoid getting one. But how to avoid the CCJ altogether?
- Seek help – Debt advisers are well-versed in such situations and can help you determine what’s the best course of action.
- Contact your creditor – If you find yourself unable to make regular payments, contact your creditor and try to work out a repayment plan that works for both of you.
- Fill out a financial statement – With this you’ll be able to show your creditors and the court how much you can afford to pay and avoid court action in the first place.
Even though CCJ removal is always a viable option, you should do your best to avoid getting a CCJ; if you take the aforementioned steps, you should be able to avoid the unpleasantness altogether.
|DID YOU KNOW? If you’re having trouble handling your finances, seek debt advice. Luckily, there are plenty of available options for debt advice, and you can even get help for free!|
A CCJ can be a scary prospect, but it’s not something that can’t be managed; once you’ve learned all there is to know about CCJs, you can proceed towards having them removed from your file, or you can ensure they don’t appear on it at all. The important thing to remember is that you must never ignore a CCJ, and it’s best to do everything you can to avoid it in the first place.
If you pay the full amount of the CCJ within the first month of issuing, the CCJ will be removed from your file and it won’t appear in the report.
Even if you don’t manage to pay off the CCJ in full after 6 years, the CCJ will be deleted from your file. You’ll still have to make the payments, but it won’t show up when someone looks into your financial background.
If you know what is a CCJ, you know it can have serious consequences. In case you receive an Order to Attend Court for Questioning and you don’t appear before the court, you can be held in contempt of the court and even imprisoned.