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What Happens If I Can’t Pay My CCJ?

If you comply in returning the form within the given time frame with the court or your creditor’s agreement to the amount you offered, the CCJ may impose the same amount in your response. Usually, the payments are in the form of monthly installments.

So, if you continue serving your debt payments as agreed, you can prevent your creditors from considering further action to recover the debt. If you own your home, you can get a charging order to secure your debt. Aside from this, there’s no other enforcement action that your creditor can take.

In contrast, if you don’t deal with CCJ, your creditor can take enforcement action against you.

Ways You Can Do If You Can’t Return the Form Within the Given Period

Furthermore, you may be asked to pay more than what you can afford if you ignore the form or when you haven’t return it within the given period. When this happens you can do the following options:

  1. Apply to change the payment terms when you found out that the amount is unaffordable
  2. Apply to cancel the CCJ or have it set aside due to lapses or flaws that’s not in your control

Option #1: Apply to Change the Terms of Payment

When the court or your creditor did not agree to the amount you’re offering each month or when you fail to return court form with the time given, the chances of getting a CCJ that you can’t afford is likely to occur.

This can be arranged in installment payment each month which might be unaffordable to your budget. Otherwise, you might be ordered to pay the entire amount in a one-time payment. In your CCJ judgment letter, the term forthwith is used to refer to this payment.

Usually, you can request the court to reconsider the payments. However, you must do this urgently.

Two Ways to Request in Reconsidering your offer:

Redetermination

In this process, you can request the court to review the payments on your CCJ and have it change when it’s too much for you. There are no costs for this process. However, you can only qualify under the below circumstances:

The CCJ was a judgment after determination, which will also be stated in the judgment letter. This happens if you’re able to return the court form with the given period yet the creditor refuse to accept your offer, allowing the court to decide on the payment rate.

Moreover, if you wish to apply for a redetermination, you can write to the court and enclose a detailed copy of your budget. This is referred to as redetermination letter. It is important that your budget shows how much you can afford to pay.

If you apply for a redetermination letter, a District Judge will handle your case and decide the payment rate. This is when your CCJ was determined and imposed by a court officer. Also, this is usually done without any court hearings.

Conversely, if a District Judge imposed the judgment on your original CCJ at a hearing, you can no longer qualify for redetermination. This instance may be unusual since most CCJ are determined by court officers without court hearings in place.

Variation

This process allows the court t alert the installments are determined too high for your income. You can apply for a variation when unexpected circumstances arise such as sudden job loss, or any misfortune that will affect your income.

The court fee for variation costs £50. If you wish to apply, you have to complete the N245 court form. This form is the same as the N9A admission form, which was sent in the post. The form will need you to complete the details regarding your sources of income and the amount, living costs, total debts, and the payment that you can afford.

After completing the necessary details, you can submit the N245 form with its fee or proof that you are exempted to pay its costs. The court will send the N245 for your creditor to review and agree with the new payments. In case your creditor refuses to agree, the court will decide a fair amount for you and your creditor. When this happens the court will notify you with the details of the new installments in the form of a letter.

So, if you want to prevent your creditor from taking enforcement action, you may need to apply for a variation; otherwise, you will have to pay the same amount in your original CCJ even if you can’t afford it. You must also pay the same amount until you get a written notice from the court regarding your new terms of payment. This process can take a few weeks.

Option #2: Apply to Cancel CCJ

If a CCJ should never have happened, you can have it canceled and is known as set aside.

If your CCJ is canceled, you will be in the same circumstances straight away before the court judgment occurred. This will give you a chance to reason out in case you missed to comply with the court forms that were sent out initially.

Conditions to set aside a CCJ

Under the following circumstances, you will be qualified to set aside a CCJ:

  • You were not aware of the CCJ that was sent to you. This can happen if you did not inform your creditor of your current address.
  • If you were able to pay off your debt and holds pertinent evidence of the payment made
  • You quickly respond upon knowing about the CCJ

Additionally, you need a £255 court fee to set aside a CCJ. You must also attend a court hearing. If you belong to the low earner, you can waive this payment using the EX160A form that you can fill in online. It is important that you contact us first before considering these options.

Can’t afford to pay a county court judgment or CCJ?

If it’s hard for you to cope up with the obligations stipulated in your CCJ or you ‘re not sure about what to do when you receive court forms, we can assist you. Should you wish to speak via phone, call us on  0800 193 1024 or check our free debt advice.