I borrowed £1,000 two years ago to buy a laptop that had to be paid back in two instalments. Back then, I did not have the faintest idea that the loan was beyond my affordability, which I did not realise until I made a default and started receiving emails and text messages from the lender to admonish me for dire ramifications. Things got worse when the matter was taken to the court, which ruled that I was guilty and that I would have to pay the whole debt.

I never thought that I would end up screwing up my credit score. To my dismay, a poor credit score was just the tip of the iceberg, all thanks to my ignorance.

Reasons why a CCJ is not good

A CCJ (County Court Judgment) is reported to your credit report that credit agencies maintain to provide your information to companies you apply to borrow money from. It can stay on your credit file for six years, which means loans, credit cards, and even mobile phones will be beyond your reach. You can do nothing but wait for the time to pass you by so the CCJ automatically disappears from your credit file.

You may not be able to get the nod even for emergency loans. While there are a few lenders who may accept your application, they will charge extortionately high interest rates to make profits by taking advantage of your poor credibility. Such lenders will most likely give the green light to small loans, such as unemployed loans for a CCJ.

The borrowing sum will be very small, and the repayment length will also be too short. There is no point in borrowing money with a CCJ on your credit report because they will take you nowhere despite on-time payments. In other words, you will see no improvement in your credit points. If you make a default or miss the payment, it will be another turn of a screw. Loans for CCJ people can be exorbitant. Based on my own personal experience, I can say that you should be wary of the consequences.

Ways to get a CCJ removed from your credit file

You will have to abide by it once the court has ruled out its decision. You have three options to choose between based on your financial circumstances to get it removed from your credit report.

  • Paying off the full amount within 30 days

Paying off your debt in full from the date the ruling was issued is the best way to reduce the consequences of having a CCJ on your credit file. Once you have paid off all of the money to the claimant, you can submit the request to the court to remove the entry from your credit file.

The court grants you a certificate as an acknowledgement of the full settlement of your account. Fees can be waived if your financial condition is not so good. Credit agencies will remove the CCJ from your report when it is removed from the Register. And then it will be as if you never had a CCJ.

What if you took more than a month to settle your account?

If you take more than a month to pay off your debt, you cannot have the entry of a CCJ removed from your credit file unless six years have passed but a note will be made against your entry that it is satisfied. It means you cannot qualify for any new loans and credit cards. In fact, you will have struggles with getting the nod for an emergency loan.

  • Wait until six years have passed

The CCJ will automatically be removed from your credit report after six years, even if you do not pay it. However, the claimant might still take action to recover it if the whole money is not paid. The lender can:

  • Either ask the court to take action or:
  • Use bailiffs to collect money from you.

This scenario usually happens when your financial circumstances are so bad that you cannot pay off the debt as per the agreed terms and conditions. Bailiffs cannot visit your house without a warrant that you can stop by filling in the N245 application form in which you are supposed to tell:

  • How many payments you can make in each instalment
  • Whether the instalment will be weekly or monthly

A stay will be granted if your payment proposal is accepted. You will not have to face threats as long as you make all payments on time.

It is important to bear in mind that the court has full freedom to exert its power on you if you owe the money and refusing to pay back.

  • You can get an order of deduction from your bank account
  • Money in your bank account can be frozen
  • The payment can be deducted when you sell any of your property, including stocks, shares, etc.

The court can call you to get details of your income and expenses to decide how much you should pay the claimant. This is the last resort when your lender turns down your proposed repayment plan.

Ways to do up your credit rating after a CCJ settlement

Here are the ways to strnegthen your credit health:

  • You should make all CCJ payments on time as agreed
  • Try to settle your debt within a month from the CCJ if the amount is not so big.
  • Do not apply for any new loan or credit card for the time being.
  • You are likely to get a loan after three or four years when the entry is old. Think of using a credit builder loan to improve your credit score.

The bottom line

A CCJ removal from your credit report is possible only when you pay off your debt within a month from the date it is issued. Otherwise, it takes six years to erase from your credit file.

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