If you’ve discovered a CCJ (County Court Judgment) on your credit file, this could have dire consequences for many areas of your life. Organisations see it as a sign that you’re not responsible with money.
As a result:
- Lenders may be unwilling to offer you a mortgage at a decent rate
- You may not be able to rent a home.
- Your job may be at risk if you work in a profession that requires a clean credit record
A CCJ could literally ruin your life.
You need to get the CCJ removed if you can.
How did the CCJ get on your credit file in the first place?
The most likely explanation for the negative credit entry is that an organisation (such as a parking management company or a financial institution) has issued court proceedings against you without you knowing about it. This may be because
- the court papers were sent to the wrong address
- you may have been away from home at the time
- you didn’t know what to do when you received the court papers
The court rules only give you 14 days to respond to a court claim. If no response is received within that time, the court works on the assumption that you’re ignoring the claim and issues a default County Court Judgment.
The court then notifies the Registry Trust that a CCJ has been issued against you – that’s the organisation appointed to maintain a Register of judgments, orders and fines.
The Registry Trust then updates, the credit reference agencies (such as Experian and Equifax) who make a note of the CCJ on your credit file.
How to get the CCJ removed
There are 3 ways to get the CCJ removed. This article will focus on the third.
1. Pay it in full within 30 days
If you pay the CCJ within 30 days, details of it will be automatically removed from the Register.
However, the 30 day period begins when the CCJ is issued – not when you find out about it. Many people are not even aware of it until after the 30 day period has expired, which means it’s usually too late by the time they find out.
Although you can still pay it after the 30 day period, the CCJ will remain on your credit file for 6 years. It will be marked as ‘satisfied’ but will still have a negative impact on your credit rating.
2. Wait for the CCJ entry to expire
A CCJ will automatically be removed from your credit record if it is more than 6 years old.
If your CCJ is very old, you may prefer to wait for the 6 year period to expire, rather than take any other action.
3. Ask the court to set aside the judgment
You may be able to persuade the court to set aside the default judgment.
To set aside a judgment effectively means to cancel the decision to issue the judgment in the first place.
If a court sets aside a judgment, the credit reference agencies are updated and the CCJ should no longer appear on your credit record. It’s as though the CCJ never happened.
The court will only set aside the CCJ in certain circumstances.
When will the court set aside a CCJ?
Generally, the court will only set aside a CCJ if it is fair to do so. The most common scenarios are set out below.
1. Where the claim form was not correctly served
A claimant (ie the organisation claiming money from you) is required to take certain steps before they can obtain a County Court Judgment against you.
In particular, they have to serve a claim form on you. To serve a claim form means to take certain steps to bring it to your attention.
Usually, this means they have to post it to your usual or last known address. If they have reason to believe you’re not at that address, they must take reasonable steps to locate you.
If the claim form was not correctly served, the court must set aside the CCJ. It does not require the judge to exercise any discretion. This is known as the mandatory ground for setting aside the CCJ.
This ground is most likely to apply if, for example, you can prove you told the claimant your new address but they didn’t update their system.
2. Where you have a good defence to the claim
If the court accepts that you have a real prospect of successfully defending the claim, then they may set the CCJ aside. They don’t have to but they will often exercise their discretion in your favour, provided that you have acted promptly.
If the CCJ is set aside, you will then have the opportunity to defend the claim at a trial.
3. Where it appears to the court that there is some other good reason to set aside the CCJ
Even if you don’t have a good defence, the court has a wide discretion and will take into account a number of factors in deciding whether there is some other good reason why the CCJ should be set aside.
For example, you may have been unaware of the claim against you, even if the claim form was correctly served. This may be because:
- you were out of the country at the time the claim was started
- the postman delivered the court papers to a wrong address
- you recently moved house and you had not yet updated everyone with your new address
In these circumstances, the court may decide to set aside the judgment. They will take into account factors such as:
- the reason you didn’t know about the court action
- whether you have acted promptly after finding out about the CCJ
- the detrimental impact that the CCJ is having on your life
Provided that your case is well presented and argued correctly, the court will usually order that the judgment should be set aside.
Will I have to attend a court hearing?
You may have to attend a court hearing and give evidence if the claimant is unwilling to co-operate.
However, if the claimant consents to CCJ being set aside, the court will usually make the necessary order. In these circumstances, you won’t have to attend a court hearing. Instead, both parties sign a document called a ‘consent order’, which is endorsed by the court. This then has the full effect of a court order.
What happens after the judgment has been set aside?
If the court sets aside the judgment, whether because the claimant consents or following a court hearing, they will notify the Registry Trust. This should happen overnight, although occasionally the court needs to be reminded.
The Registry Trust will update the credit reference agencies. This usually happens within 7 days (although they sometimes need reminding). Once that has happened the CCJ is removed from all credit reports.
It’s as though the CCJ was never issued.