The government’s Civil Justice Statistics October – December reported that judgements were up 17% in 2023.
CCJs play a pivotal role in the debt recovery process by providing a formal legal mechanism for creditors to enforce payment.
But what is a CCJ for? And how does it work?
This is part two of a three-part series where we’ve answered the most asked questions relating to CCJs, to ensure you understand them without getting lost in legal jargon.
What is a CCJ?
A CCJ or County Court Judgement, is a type of court order in the UK that can be issued against an individual or business that fails to repay money they owe. It is a formal order made by the court that the defendant/ debtor must pay the debt.
Who can obtain them?
CCJs can be used by creditors such as banks, loan companies or even individuals who are trying to recover money owed to them. If a debtor fails to pay their debt after receiving reminders and demands, the creditor may apply to the county court for a judgement against the debtor. The county court can then issue a CCJ, which formally orders the debtor to pay the outstanding amount to the creditor.
What’s the process?
The CCJ process is explained below in 4 simple steps:
- Claim: If the debt remains unpaid, the creditor files a claim with the county court.
- Notice: The court sends a claim form to the debtor, providing details of the debt and a response deadline.
- Response: The debtor can choose to pay the debt, admit the debt but request more time to pay, dispute the debt, or ignore the claim.
- Judgment: If the debtor fails to respond or the court decides in favour of the creditor after considering any responses, a CCJ is issued.
What happens if a CCJ is ignored?
If a CCJ is ignored and the debtor fails to make the ordered payments, further legal action can be taken to enforce the judgement. These steps may include:
- Bailiff Action
- Attachment of Earnings Order
- Charging Order
- Bankruptcy
Ignoring a CCJ can lead to additional costs, legal complications, and significant damage to the debtor’s credit rating.
How long does a CCJ stay on someone’s record?
A CCJ remains on an individual's credit record for six years from the date of the judgment. It is recorded in the Register of Judgments, Orders, and Fines, which is accessible to credit reference agencies. The CCJ credit rating impact can affect the individual's ability to obtain credit, such as loans or mortgages, during that period.
Is it possible to remove a CCJ?
Removing a CCJ from a credit record is possible, here’s a few steps to do so depending on the circumstances:
- Paying off the full amount of the CCJ within one month of the judgement date allows a debtor to apply to have the judgement removed from the Register of Judgements, Orders and Fines.
- Paying off the CCJ after one month will have it marked on the register as “satisfied”. While this won’t be removed, it will show as settled.
- If the CCJ was issued in error or the debtor did not receive court papers, they can apply to have the judge set aside. This means the court will effectively cancel the judgement.
Once a CCJ is removed, it won’t be visible to lenders, and credit scores go up!
Understanding CCJs is crucial for both creditors and debtors. CCJs serve as a powerful tool for creditors to recover unpaid debts, while also providing a clear legal framework for debtors to address their obligations. By following the outlined process and addressing a CCJ promptly, individuals can mitigate its impact on their credit rating and financial future.
To read part one and three of this three-part series, check out "Understanding Pre-action" and "Understanding Enforcement" in related articles below.
