County Court Judgment: what happens if you don’t know about it?

A County Court Judgment (CCJ) can stop you from taking out loans, getting a mortgage, or financing a new car or household appliance when you need it most. 

If paid within a month of the CCJ it will be removed from your credit file. However, if paid even a day later, it will stay on your credit file for six years. 

Getting a CCJ is bad enough when you know about it and when you've received a letter before action and been to court and fought it every step of the way. But at least, in those situations, you are in a position to prepare for the worst and pay it off. But what happens if you don't know about it?

If you have a busy life and have been unable to deal with a backlog of post, then you can have a claim issued against you correctly and properly and not know about it. 

This could include legal fees and court fees. Because for whatever reason you have failed to act upon it, a District Judge at the local County Court can award judgment in default against you. 

This is known as "Default Judgment" and is a common issue we see every day. You now have a CCJ. If you pay this off within a month, you could forget that it ever happened, but it sits on your credit file gathering dust until a month has past.

The first you could hear of this is when you attempt to purchase a new car on finance, and the dealership refuses to sell you anything. It might not matter that the entire judgment – for the initial debt, the court fees, and the cost of submitting the application is less than £200 – lenders take these things seriously.

What are your options?

A CCJ can be set aside – meaning that it no longer exists and therefore cannot affect your credit rating – if you can show that it was not served correctly and that you have a good prospect of defending the claim.

"Good service" of a claim form ordinarily requires service on the defendant's last known address, and it will have the defendant's correct name at the top. Both of these points are arguable in the above illustration, and you are sure that the cheque is gathering dust in the baker's desk drawer, just waiting to be cashed.

In this situation you would apply to the court to set aside the judgment. This application, if successful, would re-open the claim so that you would be able to defend yourself.

Whether or not you are successful in defending the claim, as it progresses your original CCJ is gone and can no longer affect your credit rating. If you are not successful at court, you'll get another one – but this one is easier to remove by paying the judgment debt within a month.

If your initial application fails, all hope is not yet lost. You can add a note to your credit file explaining the CCJ. You could explain that it was for a small amount and was due to wedding confusion and moving to a new house, or whatever the situation might have been depending on what went wrong. 

Lenders are obliged to read such notes before making their decision, they are not obliged to take such notes into account, but if it is there, it can go some way to explaining why you have that CCJ on your record.

Expert advice on your legal issues

If you have a CCJ you are looking to remove, our solicitors can advise you. We can apply to have it set aside so you can fight the claim, or if not, we can help formulate the note on your credit file. 

Our team of solicitors in Brighton, Eastbourne, London, Hastings and Uckfield can help you understand your options.