If you act fast, you can remove a CCJ from your credit file. Follow our step-by-step guide to see how you can undo the damage caused by County Court Judgment.
What is a CCJ?
If a company is chasing you for outstanding payments, they could send you a letter summoning you to court.
At court, the judge will look at your budget and decide on the best course of action. You could either be asked to repay the amount in affordable chunks or repay the entire sum at once. This is a County Court Judgement (CCJ).
A CCJ will appear on your credit report for around six years. This could make borrowing money more difficult, as some lenders will assume you’ll have trouble sticking to your payments.
Luckily, there are some steps you can take to remove your CCJ – or reduce the impact it has on your credit score.
Settle your balance before court
Before a CCJ claim drops through your letterbox, you’ll receive a default notice or a warning letter. A default notice will set out your next steps – like when you’ll need to repay your debts before the lender takes legal action. This is usually 14 days.
If you don’t repay the amount within that time, your account will default (shut down) and you’ll receive a CCJ.
It can feel tempting to bury your head in the sand when this happens. But dealing with your debts at this stage is much more effective than waiting until you’ve received your CCJ. This will mean your account won’t default, saving your credit report from any further damage.
Resolve the CCJ within a month
If you’ve been issued with a CCJ, you can remove it from your credit report – if you pay the balance within one month of attending court.
To keep your credit report intact, your lender will need to inform the court you’ve settled your debts. If your lender isn’t cooperating, you can send proof of your payment to the court and they should remove your CCJ.
Still got a CCJ on your credit report? If you explain the situation to your credit reference agency – like Experian – they should remove it for you.
Dispute the CCJ
You can apply to have your CCJ set aside if it’s a ‘default judgement’. A default judgement means you weren’t aware of receiving a CCJ claim in the first place.
For example, you might not have had chance to deal with your CCJ if:
- The CCJ claim form was sent to your old address
- The CCJ claim form wasn’t delivered at all (like if there were issues with the post)
- You responded to the CCJ claim form in time, but the lender ignored this or asked the court for a judgement too early
You can also dispute your CCJ if you disagree with the terms in their default notice, like:
- The amount they’re asking you to pay is incorrect
- You paid off the debt in full before the judgement
You’ll need to pay a small fee to dispute your CCJ – so only apply to set it aside if you’re confident you’re in the right.
Explain your side of the story
After you’ve been issued with a CCJ, it will appear on your credit report for other lenders to see. Even if you’re not eligible to set it aside, you could explain your side of the story to help lenders understand why you received a CCJ.
If you had personal circumstances that meant you couldn’t pay your debts, you can add up to 200 words to your credit report. This is called a Notice of Correction.
While lenders aren’t obligated to take your note into consideration, it could help them understand your situation.
Take steps to avoid a CCJ
The best way to avoid a CCJ hurting your credit score is to act fast. If you’re struggling to meet your repayments, speak to your lender as soon as you can. If they can understand your financial situation, they could offer a solution – such as a payment holiday or reduced monthly payments.
Life beyond a CCJ
If you do have a CCJ on your credit report, try to remember it won’t follow you around for life. Every six years, your credit report updates and wipes away any financial mistakes.
In the meantime, it’s important to stick to your CCJ agreement and any other financial commitments. Keeping up with all of your other debts can slowly repair any damage caused by your CCJ.
If you need finance and you have a CCJ, guarantor or bad credit options could still be available to you. If you’re confident you can handle the repayments, a bad credit loan could allow you to rebuild your credit.
