If you are struggling with debt, it is essential to spot the signs you need help with your debt. If you don’t, creditors can take action against you to get back the money you owe them. One of the ways they will try and recover money from you is by applying for a County Court Judgement (CCJ).
A CCJ shouldn’t come as a surprise, as quite often, you will have already been sent reminder arrears letters in the post. It is essential not to ignore it. However, what do you do if you get a CCJ?
Instead, read our FAQs and find out all you need to know about CCJs and how best to tackle your debt problem.
What is a County Court Judgement?
A County Court Judgement (CCJ) is a notice issued by the Court advising you that you must pay a debt you owe to a creditor.
A decision is then made on whether you will need to pay the debt, and if your creditor is correct in asking you to pay the outstanding debt, they will issue you with a CCJ.
However, before a CCJ can be issued, your debtor will need to follow the pre-action protocol. They will send you County Court Claim Form (N1 Claim Form).
I have received a County Court Claim Form. What should I do?
Before a creditor can apply for a CCJ, they must send a letter, often known as a default notice. Find out more about default notices here.
This is a warning letter that legal action could be taken if the outstanding debt is not paid within 14 days of receiving the letter.
The letter will include the following:
- Claim form – which includes details of the amount that is owed and the interest being added. This is marked as the N1 Claim Form.
- Response Pack – an admissions form, a defence form and an acknowledgement service form.
You must respond within 14 days of receiving these forms, or a CCJ could be issued as a default judgment.
How do I complete my County Court Claim form?
To complete the correct form included in your response, you need first to know what course of action you are taking.
If you agree that the amount on the claim form is right
You must fill in the Admissions (a specified amount)’ form. The form number is N9A in the bottom right-hand corner.
The N9A form should be sent back to the creditor shown on the address of the N1 claim form.
If the amount on the claim form is wrong, or you don’t owe the money
Sometimes you might not agree with the creditor’s claim, or you don’t owe them the money.
If you don’t agree with the amount claimed, you can ‘defend’ the claim by returning the ‘Defence and counterclaim’ form, marked N9B in the bottom right corner.
If the amount on the claim form is partially correct and you owe some money
If you think you owe something, but the amount claimed is wrong, you can submit a ‘partial defence’ by completing both the N9A and N9B forms.
Both forms would need to be sent to the Court in this case.
Remember, defending a claim can be complicated. You may need to ask for more information and probably need to attend a hearing with the District Judge. In some cases, extra costs could be added if your claim is rejected.
I have sent my County Court Claim Form. What happens next?
If the Court accepts your offer, you will receive a County Court Judgement giving you details on when and how to make the payments.
What should I do if the Court does not accept my offer on my County Court Claim form?
Sometimes, the Court may not accept your offer. They may ask you to pay more than you can afford. You can write to the Court quoting your case number to reassess the payment or offer within 14 days of receiving the judgement.
It might also be a good idea to include a copy of your current financial statement showing that you can only afford the amount you have stated.
What happens if I ignore the County Court letter?
If you choose to ignore the initial letter sent by the Court, then the Court will agree on a payment plan for you. This may mean that the repayment plan could be more than you can afford, so it is crucial to respond rather than ignore the letter.
I don’t agree with my CCJ. What should I do?
If you receive a CCJ and disagree with it, you are entitled to dispute it. You can either dispute the whole amount or just Part Admission. You will need to fill out the N9b form in the response pack.
What are the reasons I could dispute a CCJ?
There are several reasons why you may dispute a CCJ, including:
- the debt has been paid
- the debt is not yours
- the amount is wrong
- you have been declared bankrupt,
- you’re entering into a DRO
- You are setting in place an IVA
- The debt is no longer enforceable because the time a creditor had to chase it has passed
- you have a counterclaim, which could be for goods or services that you never received
I can make my County Court payment in full. What should I do?
If you agree that you owe your creditors the money and want to pay in full, you must fill out an N9a form.
You will need to send your payment in full to the Court before the 14 days deadline. This will mean no CCJs will be awarded against you.
What should I do if my circumstances change and I can’t make my County Court payments?
If your circumstances change in the future and you cannot afford the monthly payment, you can apply for an alternative repayment amount. You will need an N245 form.
You will need to send a £14 fee with this form; however, if you receive benefits, then you will be exempt.
Find out all you need to know about being debt whilst claiming benefits.
Will I need to go to Court if I am issued with a CCJ?
When you hear the word court, you instantly think that you might have to attend Court. A CCJ does that mean that you have to attend Court. Instead, you will receive a claim form to which you will need to reply within 14 days to either agree or disagree with the claim.
If you choose to ignore them, the Court will issue you with a CCJ, which will mean they will ask you to pay the agreed amount even if you can’t afford it.
The Court has issued me with a CCJ and repayment plan. What should I do?
If the Court has accepted your payment proposal, it is vital to keep to the repayment plan sent. Failure to do so could result in them taking further action such as:
- instructing bailiffs to remove goods from your home,
- contacting your employer to arrange for their debt to be paid directly from your wages
- obtaining a Third Party Debt Order which freezes your bank account
- attempting to petition for your bankruptcy.
Always keep a record of your payments. You will need to provide a receipt of proof each time you make payment.
It might be wise to set up a standing order with your bank so that you can keep up with your payment plan.
You can also send a cheque or postal order via registered post, which will provide proof of payment if there is a dispute in repaying your debt.
What if I don’t make my CCJ repayments?
Your creditors may choose to use bailiffs to recover the debt owed to them. They will need to apply for a court order or a warrant, giving bailiffs the right to visit your home or workplace to collect the money.
You will be given seven days’ notice that the bailiffs visit your property to collect the debt.
I have more than one debt or CCJ. Can I pay them altogether?
If your total debts are less than £5,000, you can group all of them and make one monthly or weekly payment. You will need to complete an N92 Application For An Administration Order form.
The benefit of this is that you will be able to manage all your debts together rather than paying out several single payments, which sometimes you can lose track of.
Can a CCJ affect my credit rating?
Yes, a CCJ can affect your rating. A County Court Judgement (CCJ) will stay on your credit report for six years. It will still be visible even if it has been marked as settled. After six years, it will be removed, irrespective of whether you have paid it or not.
What if I settle my CCJ? Will this improve my credit score?
Paying off your CCJ won’t improve your credit rating instantly; however, the older the CCJ is, the less impact it will have on getting you getting credit in the future.
Often, you will have to wait a few years before you see a positive impact in settling your CCJ. One thing to note is that if the CCJ is marked as ‘settled’ on your credit rating, this could look better to some lenders.
Find out ways to improve your credit score.
How do I get CCJ removed from my credit report?
You can only get a CCJ removed if you pay your debt off within a month of it being issued. This is called CCJ discharged.
You will need to have it removed by sending off a completed N443 form to the Court that issued you with the CCJ and asked for cancellation certification. There is a fee of £15, but you will be exempt from paying if you are on benefits.
To find out more about CCJ discharged and what it means.
Alternatively, after the deadline has passed, you can apply for the CCJ to be ‘set aside’. You can only do this if you are genuinely unaware of the CCJ issued against you. You would need to fill out an N244 form and pay a fee of £225.
However, this does not mean your debt will disappear. The creditor can still demand the debt repaid even after a CCJ has been set aside.
Find out ways you can improve your credit rating.
How else can other people or creditors find out about my CCJs?
CCJs in England and Wales are listed on the Register of Judgements, Orders and Fines. This is called the CCJ Register.
This public register has all the details of people who have had CCJs issued against them.
Do all CCJs appear on the CCJ Register?
The majority of CCJs appear on the register, but some don’t. To have a CCJ appear on the register, the judgement must be:
- issued in default (i.e. a judgement without trial where no defence was entered)
- payment is by instalment order or where enforcement action is being taken.
How long does a CCJ stay on the CCJ Register?
A judgement will stay on the register for six years from the registration date. Details of the judgements will be sent to the credit reference agencies, which will mean that lenders will see them on your credit report when you apply for credit.
If your CCJ has been paid in full, then you can get a ‘certificate of satisfaction. This will not remove the CCJ from the register, but it will prove that it has been paid off.
Can I get a mortgage or other loans if I have a CCJ?
A CCJ will make it very difficult to get approved for a mortgage and other loans. As lenders have access to your credit file, they will be able to see the CCJ associated with your account.
However, if you have been making your repayments on time, then this could work in your favour. Also, if your CCJ is not recent and a few years old, then there is a better chance that you could get a mortgage or a loan.
Find out how to get help if you have mortgage debt and arrears.
What debt solutions are there to help me get out of debt?
Once you have accepted that you want to take those first steps to financial harmony, then there are different debt solutions to manage your debt which include:
Debt Consolidation – This is when you take out one debt consolidating loan to pay off various others. Offering you a more affordable monthly payment, you need to consider that if the loan amount is over £25,000, the company may ask you to secure it against an asset.
The unsecured option is also riskier for the lender, so they are likely to look at your credit score and financial health in much more detail before they offer you this option.
Find out more about the benefits and risks of debt consolidation.
Individual Voluntary Agreement (IVA) – A IVA is a formal and legally binding agreement between your creditors to pay off your loans. As it is legal, it needs to be set up by an Insolvency Practitioner. That person will charge you a fee to act on your behalf.
IVAs come with a whole host of questions, and it is essential to understand the details of IVAs before you consider them as a debt solution.
Debt Management Plan (DMP) – A debt management plan is an agreement you have made with your creditors to get you out of debt and try and pay them. The agreement is informal, and it is usually negotiated by a third party to lower your monthly payments paid to your creditors.
Find out more information on the debt management plan.
There are other debts solutions to help you get out of debt. To understand which one is right for you, check out our debt plans