Credit Score Basics > What is a County Court Judgment (CCJ)?

What is a County Court Judgment (CCJ)?

4 minute read · Updated 21st April 2024

A County Court Judgment (CCJ) is a court order that can be issued against you if you fail to make regular repayments on a debt.

CCJs can only be used by creditors in England and Wales – Scotland and Northern Ireland have slightly different ways of getting money back by going to court.

How does a CCJ work?

The CCJ process involves your lender and the court sending you several letters, each with specific deadlines to fill out and send back before the judge actually issues the default judgment. It can take at least two months.

The first letter is usually called "default notice".

The default notice includes details of your missed payments and when you must pay them.
Your creditor has to give you at least 2 weeks to reply or make the missed payments.
It must also include a fact sheet which explains your rights.
At the top of the first page, it should say, "Default notice served under section 87(1) Consumer Credit Act 1974".

If 14 days have passed and you didn’t respond, didn't make a repayment, or couldn't reach an agreement, you will receive a new letter.

This second letter is called a "letter of claim".

The letter of claim makes it clear that the creditor will take legal action next.
It must include a "reply form," which you can use to agree that you owe the debt or request more time to repay it.
It will also include a "standard financial statement", which you can use to tell them what you can afford to pay – if you cannot repay the total amount.
You should also let the creditor know if you're seeking help from debt charities.
The letter of claim must give you 30 days to respond.

If you still can't reach an agreement after 30 days, the lender has the right to take legal action.

The third letter you receive will actually be a "Claim Pack", and it will contain multiple forms.

This is sent by the court, not your creditor.
It must give you at least 14 days to reply.
The claim pack should contain four forms: a claim form that tells you how much you owe and why; a response form that you can use to ask the court for more time; an admission form that you can use to make a partial offer to pay; and a defence and counterclaim form that you can fill out if you disagree with the debt, or believe that the creditor owes you money instead.

These forms usually start with the letter N: "N1—Claim form,"" N9—Response pack," "N9A—Admission," and "N9B—Defence and Counterclaim."

This doesn’t mean much – it only tells you that the creditor processed your debt "in bulk" alongside other debts via the Northampton County Court, the only court where they can do this.

If you need help filling out these forms, StepChange, one of the UK's largest debt charities, has a great YouTube video that shows you how to do it step by step.

Whatever you choose, though, don't delay. If you ignore this Claim Pack, the court may take further action.

Some examples of what "further action" can mean:

Warrant of Execution – the court can send bailiffs to take any goods you have that could be sold to repay the debt.
Attachment of Earnings – the court can have money taken directly from your salary.
Charging Order – the court may secure the debt against your home, which means that if you miss any repayments you might lose your property.

This is why it's essential to reply to the court and not ignore the CCJ. If you're struggling, ask to pay the money back in smaller instalments – the court will take your situation into account.

How does a CCJ impact my credit score?

Once issued, a CCJ is recorded in the Register of Judgments, Orders, and Fines, where it will appear for the next six years.

If you manage to pay the entire debt within the first 30 days of the CCJ being issued, you can stop this from happening. In this case, the CCJ won't show on your credit report – although the defaults that have led to your CCJ will still be visible.

But once the CCJ is recorded in the Register, it will also be communicated to the credit reference agencies, and they will add it to your credit record. Once there, a CCJ will stay on your credit record for 6 years.

According to Experian, having a CCJ on your report will seriously hurt your credit score – by as much as 250 points.

The impact won't be limited to your credit score, either:

A CCJ will also make it almost impossible to get a loan or credit card or even to open a basic bank account for the next few years.
You might also find it harder to get a job – employers may check your credit report as part of their background check.
You could also find it more difficult to rent a flat—letting agents also check credit records to ensure tenants have a history of paying their bills on time.

How can I rebuild my credit score after a CCJ?

First, there are a few things you can do to reduce the impact of a CCJ:

Pay it fully within 30 days – this will stop it from having an impact on your credit score at all. It won't show up in your credit report, either.
Pay it fully whenever you can – the next best option. Once you've repaid your CCJ, it will show as "satisfied" on your credit report. This will somewhat soften the blow of the CCJ.

You should also continue to try and improve your credit rating:

Register to vote.
Make repayments for the CCJ and any other debts.
Make fewer applications for credit. Always use an eligibility checker, and don't make more than one application every three months.
Get your Statutory Credit Report and correct any errors in there.
Avoid credit repair companies. Any company that claims to clear debt records promises something that isn't really possible.
Use a credit-building tool like a credit-building credit card, Experian Boost, or Wollit.

In short, if you have a CCJ don't give up on your credit rating. Keep showing that you're a responsible person who pays their bills on time.

Eventually, the CCJ will become less important, and after six years it will be a thing of the past. Working on your credit score until then will ensure that you're not restarting your finances from scratch.