If you’re planning to apply for a mortgage soon, it’s essential to have a clear understanding of your financial standing.
One factor that can significantly impact your creditworthiness is a County Court Judgement (CCJ). In this article, we will explore what CCJs are, how they can affect your credit score and borrowing abilities, and most importantly, how to find out if you have a CCJ.
Understanding County Court Judgements (CCJs)
A County Court Judgement, commonly known as a CCJ, is a court order issued in England, Wales, and Northern Ireland. It is usually issued by a county court when someone fails to repay a debt they owe. The individual or organisation owed the money, referred to as the claimant, can request a CCJ to be issued against the debtor.
Having a CCJ can have various consequences. It can significantly impact your credit score, making it harder to secure credit or loans in the future. Additionally, a CCJ can affect other aspects of your life, including employment opportunities and housing options.
How to Check for a CCJ
To see if you have a CCJ, there are two primary methods you can use:
- checking your credit report
- checking the Registry Trust
To check your credit report, you can obtain a copy from credit reference agencies such as Experian, Equifax, or TransUnion.
Your credit report will provide detailed information about any CCJs against your name, including the date of issue, court reference number, amount owed, and whether the judgement is active or satisfied.
Another option is to check the Registry Trust, a public record of CCJs in England and Wales. You can access this information by visiting their website and performing a search. Keep in mind that there might be a small fee involved when using the Registry Trust service.
Understanding the Details of a CCJ
When you find a CCJ against your name, it’s essential to understand the information provided. The court reference number mentioned in the CCJ can help you find out more about the judgement. By contacting the court that issued the CCJ and providing them with the reference number, you can inquire about the details of the judgement, including what it is for.
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The Lifespan of a CCJ
CCJs have a limited lifespan, and understanding this can really help you. A CCJ typically remains on your credit file for six years from the date of issue. However, if you repay the debt within a month of the judgement being issued, it can be marked as ‘satisfied,’ indicating that the debt has been paid in full.
It’s important to note that even after a CCJ is satisfied, it will still appear on your credit file for the remainder of the six-year period. Lenders and financial institutions consider CCJs when assessing your creditworthiness, even if they have been satisfied.
The Impact of a CCJ on Borrowing
A CCJ can significantly impact your ability to borrow money.
Mainstream mortgage lenders generally view CCJs negatively, as they show a history of missed payments or financial difficulties. However, there are specialised lenders who cater to individuals with poor credit.
These lenders have specific bad credit mortgage products designed to help those with a less-than-perfect credit history.
It’s important to be aware that lenders may charge higher interest rates and have stricter lending criteria. Therefore, make sure you carefully consider your options and seek advice from a qualified mortgage broker.
If you need to apply for a joint mortgage, and the other person has bad credit, then this will affect your application. Read more.
Can a CCJ be Removed?
Under certain circumstances, it is possible to have a CCJ removed or set aside. If you believe there are valid reasons for challenging the judgment, you can apply to the court for it to be set aside. This process involves submitting an application and providing evidence to support your case.
However, it’s important to note that successfully having a CCJ set aside is not guaranteed. The court will consider various factors, including the merits of your case and the time that has passed since the CCJ was issued. It is advisable to seek prior legal advice if you are considering this course of action.
Preventing and Dealing with CCJs
Prevention is key when it comes to CCJs. Promptly addressing any debts and making regular payments can help you avoid the possibility of a CCJ being issued against you. It’s essential to communicate with your creditors if you are facing financial difficulties and explore potential solutions, such as debt management plans or repayment agreements.
Lenders are required to send you a Default Notice before any legal actions. Don’t ignore this letter, as it offer an opportunity to avoid getting a CCJ.
If a CCJ has already been issued against you, it’s important not to ignore it. You can either pay the debt in full or arrange a repayment plan with the claimant. Reach out and discuss your situation rather than ignoring the CCJ, as non-payment can have severe consequences.
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