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Tackling your debts

How to avoid a CCJ

Posted 30 May 2016 by Christine Walsh

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Learn how to avoid a CCJ and deal with your debts.

If you’re having trouble making your repayments on your unsecured debts, you might be worried that you’ll get a County Court Judgement – but it doesn’t have to end up this way. Let’s explore how you can avoid this and what to do if you’ve received a letter about court action from one of your creditors. 

What is a CCJ?

A County Court Judgement (CCJ) is a court order in England, Wales and Northern Ireland, which states you owe a certain amount of money to a creditor. It also outlines when and how you must pay this money back. 

A CCJ means your creditor has tried all other ways of trying to get the money back, and has asked the court to look into the matter. If you’ve got a CCJ, it means that the court agrees you owe the money the creditor wants from you. 

Unless you pay everything back on the CCJ within one month of getting it, it will stay on your credit history for six years. 

How do I avoid a CCJ?

The best way to avoid a CCJ is to contact the creditor and explain your situation to them before they start court action. The more communicative and cooperative you are, the less likely you are to end up with a CCJ.  

Even though you can’t maintain the payments you first agreed to, this doesn’t mean that you have to end up being taken to court – it is sometimes possible for creditors to put an arrangement in place. 

In some cases they can suspend your payments for a while, giving you that breathing space you need. Or, they can lower what you need to pay for a time, or perhaps just freeze interest and charges so that you don’t end up being penalised for any payments you do miss. 

A debt solution can help

Debt solutions are plans that help people get unmanageable debts back under control, and some of them can help you avoid a CCJ. It’s not ‘one size fits all’ with a debt solution – there are different ones to help people in different situations. 

Some debt solutions, like Individual Voluntary Arrangements (IVAs), are legally binding, which means that, as long as you abide by the rules of the plan, your creditors won’t be able to take legal action against you. 

An IVA, or any other debt solution, will stay on your credit file for six years, just like a CCJ. But the advantage of starting an IVA is that you only make one payment towards all your unsecured debts a month and if it completes successfully the rest of your debts are written off. In order to know for sure which debt solution is best, you should get professional advice. 

Debt Advisory Centre advisors are specially trained to be able to identify which debt solution will suit you. If you get in touch, they’ll talk through your situation as it stands, and also what you think the future holds. Based on the info you give us, we’ll be able to recommend the best course of action. 

Although there may be fees associated with some ongoing debt solutions, the initial advice we give will always be free of charge. It couldn’t be simpler – just use one of the options on the left of the page to get in touch. 

There’s also lots of help available from the Money Advice Service – a free and impartial resource set up by the Government. 

Do I have to stick to the terms of a CCJ?

Yes, you do. If you already have one, it’s very important that you stick to the terms of your CCJ. If you don’t, the creditor can take enforcement action – this can include sending bailiffs round and taking money directly from your wages or benefits. 

If you have a number of debts as well as your CCJ, and you’re struggling to pay them all, a debt solution can help ease the strain and enable you to manage all your debts.  

What does my letter mean?

Unless you’re familiar with the process, it can be hard to tell what’s going on when it comes to court action and CCJs. Here’s a rundown of the letters you might receive relating to CCJs, and what they mean.

Threat of court action. Creditors can’t just have a CCJ issued against you right away – they must warn you of their intention to go to court and give you time to respond. If you get a letter threatening court action, don’t just ignore it. Get in touch with them and offer to pay something every month that you can realistically afford. 

Claim form letter. If you get a letter with ‘claim form’ at the top, this means that your creditor is going to take court action, but you don’t yet have a CCJ. You should respond as quickly as you can to these types of letters. You can either accept you owe the money, or if you don’t believe that you owe this debt, you can dispute it. Have a look at our blog How to dispute a County Court Judgement for further information. 

Judgement for Claimant. If your letter says this at the top then you have a CCJ. To avoid your creditor sending bailiffs round or taking anything from your income, you need to respond to the CCJ as quickly as possible. 

Debt problems can be stressful and overwhelming. If you’re really suffering from the stress of debt, make sure you look at the wellbeing section of the blog for tips and advice on how to cope. 

Whatever your situation, we’re here to let you know that no one is beyond help when it comes to debt. Reach out to us, the Money Advice Service or a debt charity, and get the advice you need. With the right help, you’ll be able to work towards a future free of problem debt. 

by Christine Walsh

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To find out more about managing your money and getting free debt advice, visit Money Advice Service, an independent service set up to help people manage their money.