What is a county court judgement (CCJ) and how can it affect your credit?

A lawyer sat next to a judge gavel

If you ignore or refuse to pay outstanding debt, you could end up with a County Court Judgment (CCJ) being recorded against you which will show up on your credit report.

But how bad is a CCJ and can you ever borrow money again if you get one? Here's all you need to know.

What is a County Court Judgment?

A County Court Judgment (CCJ) is a formal legal document issued by a court after a debtor (person who owes money) has ignored all previous requests for payment and ultimately, court proceedings issued by a creditor.

A Judgment (a type of Court Order) formally confirms the court agrees that the money is legally owed and orders the debtor to settle the debt and any associated costs within 30 days of receipt.

The Judgment will confirm:

  • The amount a debtor needs to pay
  • Who the debtor should pay
  • How the debtor can pay
  • A cut-off time (deadline) for payment

Why do I have a County Court Judgment?

You will have a CCJ recorded on your credit file if you have:

  • an outstanding debt that you have not made a payment towards for some time
  • not responded to any of the debtor’s attempts to contact you for a long time
  • not told the debtor that you have moved or supplied them with your new address 
  • not seen, ignored or responded to a letter before action
  • not seen, ignored or responded to Court proceedings issued against you

How does a CCJ affect you?

Unless you settle a CCJ in full within 30 days of receipt, the Judgment will be recorded on the Register of Judgments, Orders and Fines.

This means that whenever you apply for credit and a lender checks your credit history, they will see that you have a CCJ recorded against you and an associated low credit rating.

Having a CCJ recorded on your credit file will significantly harm your credit score and hinder your eligibility for any type of borrowing such as a credit card, overdraft or mortgage in the future.

Read more: What factors affect your credit score?

How long does a CCJ last?

Just like a default notice, an unsettled and ignored CCJ will stay on your record for six years.

This means that every time you apply for credit a potential lender will be able to see that you have a CCJ recorded against you.

The only way you can remove a CCJ from your credit file, is by settling the Judgment amount, in full, within one month of receiving the Judgment.

How to pay a CCJ (step by step)

Step 1: Check who to pay

Check the CCJ to find out the name of the business or person (or solicitor) you need to make payment to; do not send payment to the Court.

Step 2: Check how to pay

The CCJ will tell you how you should pay the settlement amount and the deadline for payment(s). If you’ve been given the option of paying off the debt in instalments, ask the Claimant how they would like you to pay.

The best way would be by standing order to ensure you never miss a payment which could result in further court action and related costs.

Step 3: Request a change to Judgment terms

If you cannot afford to pay what is ordered by the Court, you can apply to the Court to vary the Judgment by completing and submitting a Form N245 and a Court fee of £14 (although you may be exempt from paying a fee if you’re on certain benefits).

You will need to supply the Court with details of your income and expenditure to evidence why you can only afford to pay a certain amount. If your revised payment offer is rejected, the Court will instead decide on the amount you have to pay.

Step 4: Keep a record of payment

You will need to ensure you retain evidence of any payments so do not send cash in the post. Instead, you should pay by BACS, cheque or postal order and if sending payment by post, for added security, use the Royal Mail ‘signed for’ service.

What happens if I don't pay a CCJ?

If you ignore a CCJ, the claimant can take the matter back to the Court to request enforcement of the debt and the Court may decide to:

  • Instruct Bailiffs
  • Issue a Charging Order
  • Issue an Attachment of Earnings Order
  • Order you to attend Court to explain your financial status 

Bailiffs

If the Court agrees to Bailiff action, it will issue what is called a Warrant of Execution.

Should this happen, you must just do whatever you possibly can to come to an agreement or make a payment to avoid any goods being removed from your home or place of business (if applicable).

Charging Order

Nearly equally as scary is the possibility of a Charging Order being issued by the Court which means the claimant you owe money to can secure this Order against your property and if you still don’t settle the debt, apply for an ‘Order for Sale’ to force you to sell your property!

Attachment of Earnings Order

If you want to be able to look the payroll department in the eye at work, then avoid having an Attachment of Earnings Order. If the Court agrees to this course of action then they will arrange for payments to be taken directly from your wages every month.

What if you don't pay a CCJ after 6 years?

If you’ve managed to survive financially and have gone under the radar for six years, you’ll be wondering if that’s it - does the CCJ get removed from your credit file and forgotten about?

Yes and no.

Yes, after six years have elapsed the CCJ will get removed and when you apply to borrow money, it will no longer be visible to lenders. (Yay!)

However, according to debtcamel.co.uk, a CCJ never becomes statute-barred, but if no enforcement action has been taken by the claimant within six years, they will have to apply to the Court for their consent to use Bailiffs. Whilst this doesn’t happen very often, it can happen and if it does, you should seek advice from Citizens Advice or a debt charity.

Can I borrow money with a CCJ?

You will struggle to get any type of mainstream credit with a CCJ, including a mortgage, personal loan, credit card or a bank account with an overdraft facility.

There are specialist lenders for debtors with CCJs, but these types of borrowing are typically high-interest, short-term loans like payday loans.

You might like: 9 different ways to borrow money

How to check CCJ

You can easily conduct a CCJ check by requesting a copy of your credit report, for free, from Checkmyfile (30-day free trial).

Alternatively, you can check with trustonline.org.uk, but this service costs between £6 and £10 (depending on how many registers you want to search) and doesn’t provide as much information as a free credit report.

If you’re worried about debt, you’re not alone! Be sure to visit or contact debt charity StepChange or Citizen's Advice.

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