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When a company you owe money to pursues you for a debt in England, Northern Ireland or Wales, a common course of action is for them to apply to the courts to impose a CCJ, or county court judgement, on your credit file.
A CCJ is a court order that seeks to force you to repay money owed. If you live in Scotland, you’ll receive the Scottish equivalent of a CCJ. This is known as a court decree.
A decree works in the same way as a county court judgement. If you don’t pay off the debt you’re due within one month of the decree being issued, it stays on your credit file for six years, is logged in the public register of insolvencies and can be highly damaging to your creditworthiness.
What happens when you get a CCJ in Scotland?
Default notice to repay money owed
After you miss between three and six payments on a debt, whether that’s council tax or an unpaid phone bill, you will usually receive a default notice from the company you owe money to.
This document is a formal letter that gives details of how much money you owe and what action you need to take to prevent legal action being taken against you to recover the debt.
Court action
If you don’t respond to the default notice, the next step for a creditor is to pursue legal proceedings.
This could result in you being issued with a County Court Judgment (or ‘decree’, which is what they call a CCJ in Scotland).
If this happens, you’ll be ordered by the Sheriff Court to pay the money due to the creditor who’s pursuing the debt.
It usually happens when you can’t pay your debts by the payment deadline, or your debts have been in default for some time.
A decree could also mean you have to pay any interest or expenses due to the court, however there are restrictions n how much interest creditors can apply to your debts if they are covered by the Consumer Credit Act.
Damage to credit record
Information about your court decree will be shared with credit reference agencies for six years.
This can make it more challenging to get any form of credit, apply for mortgages or finance. It also means you’ll have to pay pricier interest rates if you do get credit.
How long does a CCJ last in Scotland?
A CCJ lasts for the same duration as a Scottish decree, which is six years from the date of the judgement.
Any CCJs you have against you will also be recorded on the public register of insolvency for six years.
This can make it much harder to apply for credit, especially in the first 12 months of the CCJ being added to your credit file.
Even if you pay the decree, unless you pay it straight away, this will remain on your file for the same duration once it’s been issued.
What happens if I ignore a CCJ in Scotland?
Ignoring a CCJ or decree is a bad idea, because it gives the company you owe money to license to pursue even more severe measures to recover the debt you owe.
Here are just a few of the steps a company can take if they decide to continue recovering the debt after a CCJ or decree is issued:
Applying for an attachment of earnings order
An attachment of earnings order involves applying to your employer to recover the money you owe them directly from your pay.
They can only apply for this if you are currently working, and this isn’t something your creditor can apply for if you owe them less than £50.
If this order is granted, it can put you in a poor light with your employer, so it’s always best to contact your creditor and agree a way of paying back the money you’re due before it comes to this.
Applying for a charging order
When your creditor applies for a charging order, it means that they can apply to secure any money you owe them against your house.
They’ll only go down this route if you already have a property.
If you’re a joint homeowner with someone else, they will still be able to get the charging order, but only against your share of the property – known as your ‘interest’ in the property.
Sending sheriff court bailiffs
Certain creditors, for example, local authorities, will use bailiffs to enforce the debt. Bailiffs are not to be confused with debt collectors; they have greater powers, including being able to repossess goods, enter your property and add fees and interest to any money you already owe.
If you’ve already been contacted by bailiffs, you should read our sheriff officer advice page for more information.
Applying for sequestration
If you owe one creditor more than £3,000, they can apply to the courts to make you bankrupt.
This can result in your assets being sold to pay your debts, and can be hugely stressful and unpleasant.
The only way to guarantee that no further action is taken against you is to pay off the debt.
Although the CCJ or decree will remain on your credit file, it will at least be marked as ‘satisfied’ when you pay it off in full.
Can an English CCJ be enforced in Scotland?
Yes – but the paperwork and processes vary depending on which country you’re in.
- If the CCJ was issued in England – The person you owe money to needs to request a document called the Certificate of Money Provision from the court that issued the CCJ. After it’s been requested, this is used to take action against the person who owes money.
- If the CCJ was issued in Scotland (as a decree) – The court or sheriff officers would again need to issue a certificate as proof of this, and a notary will need to witness and sign the document.
Can you get a CCJ without knowing?
Yes, it’s quite common for people to have a CCJ or money decrees against them and not know about it until they try to get credit or apply for a mortgage.
You can get a CCJ without knowing about it a few ways. You may have moved address since the initial claim was made against you or be living at a different address to the one your creditors know about.
A CCJ can be made against you even if you don’t attend court, or if you don’t respond in any way to the claim against you. If this happens, the CCJ will be recorded against you in default.
If you suspect you have a CCJ, or if you’ve just found out that you have a historic CCJ, you can find out more about it by checking your credit report with one of the three main credit agencies in the UK – Equifax, Experian or TransUnion. There are also some free services available that you can use, like ClearScore and Credit Karma.
Another way to find out more about a CCJ is to check the public register of judgements.
This will show your name and address, the name of the court that issued the judgement, how much money the judgement was made for, the date it was issued and whether the debt has been satisfied or not.
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Can you get a CCJ removed in Scotland?
Yes – but only if you have a strong reason to have it set aside. Here are a few reasons you may have a valid claim against a county court judgement:
- If it’s been made against you in error – for example because the debt is in someone else’s name.
- If you weren’t aware of the debt – maybe if you’d moved to a new address and didn’t know about the debt.
- You may not have had the chance to defend it.
- The judgement may not have followed the necessary protocol.
How to get a County Court Judgement removed in Scotland
There are a few different ways you can go about getting a CCJ or decree removed from your credit file:
Pay it off within 30 days
You can have the CCJ removed from your file if you pay off the amount due, in full, within one calendar month of receiving the judgement.
This way, all traces of the CCJ will be removed from your credit report, as well as from the Insolvency Register.
It’s important to be aware that if you do pay off your CCJ within 30 days, this may not automatically be updated on your credit file.
The company you owe money to is responsible for notifying the court that the debt has been satisfied. If they fail to do this, you can always let the court know yourself – there’s a fee of £15 to do so.
Pay it off after 30 days
While a CCJ will still remain on your credit file if you pay if off after the 30-day period, you’ll still be looked on more favourably by creditors if the debt is satisfied – and reduce the damage it does to your credit file.
If you settle the debt, you’ll receive a certificate of satisfaction and your credit report and the insolvency register will be updated to reflect that the debt has been settled.
Have the CCJ set aside
There may be an argument for having the CCJ set aside, for example, if you don’t owe the money, the amount included in the CCJ was incorrect, or you didn’t receive information about the claim.
To have a CCJ set aside, you have to use court form N244 and may have to pay a fee of £255 to request a private hearing to explain why you don’t think you should pay the debt. If you’re successful in your claim, the CCJ will be removed from the insolvency register and your credit file within a month.
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Why would I have a CCJ removed?
If you believe you have a case for having the CCJ removed from your file and the insolvencies register, you should definitely pursue this course of action.
You may be concerned about the costs concerned, or the hassle of making contact with the courts, but a CCJ can cause long-lasting damage to your credit file.
How does a CCJ affect your credit score?
A CCJ will negatively affect your credit file for a full six years; and during this time, creditors will be able to see whether you’ve satisfied the debt, or if it’s still unsettled.
Having a CCJ will make applying for any form of credit challenging.
Even if, in the immediate term, you’re not planning on taking out any finance, it can make applying for a mortgage, taking out car finance, getting a new mobile phone or getting credit against household purchases much harder.
What’s more, if you do get credit, it will be far more expensive if you have a CCJ or defaults recorded on your credit file.
Especially in the first 12 months of having a CCJ, you’ll only be offered the worst possible interest rates, and may have to speak to a specialist lender to get help with certain kinds of credit.
With time, the impact a CCJ has on your credit file will lessen. And there are some ways to rebuild your credit score and minimise the lasting damage it can cause.
Here are a few fixes to help you improve your credit rating:
- Satisfy the debt by paying it off promptly and applying for a certificate of satisfaction.
- Make sure you’re on the electoral register at your current address.
- Keep up to date with all your existing bills and credit agreements.
- Monitor your credit report regularly, and make sure all the information on it is accurate.
When the CCJ does finally expire after six years, it will be fully removed from your credit file and the public registry, whether you’ve satisfied the debt or not.
Where can I get debt advice that could help me avoid court action?
Are you struggling with your finances? Is the worry of decrees, defaults, and debt keeping you up at night? Don’t let money problems take over.
It only takes one call to turn things around.
At Carrington Dean, we’re Scotland’s debt specialists. We’re experts in practical debt solutions like the Trust Deed and Debt Arrangement Scheme that can help you regain control of your debt problems and avoid court action.
