Can you get a loan with a CCJ?

What is a CCJ? 

A County Court Judgement (CCJ) is a court order that’s issued by a creditor if you fail to repay your debt. A CCJ ‘judgement for claimant letter’ includes: 

• How much you owe 
• Who to pay 
• How the money should be repaid (e.g. in full or in instalments)
• The deadline for paying

Note, CCJs are only issued by creditors in England or Wales and Northern Ireland. Whereas in Scotland, creditors follow a different debt collection process and judgements are known as ‘decrees’. 

What are your options if you receive a CCJ? 

If you receive a CCJ, your options are: 

1. Pay the full amount 
2. Request to change the terms to make them more affordable
3. Apply to have the debt set aside (or cancelled) if you're certain you don't owe it

Read on to find out more about debts being set aside.  

If you don’t take any action within 30 days, then a CCJ will be registered on your credit report for six years. This can seriously affect your ability to get credit in the future. It will stay on file even if you pay it off before the six years is up. (However, once cleared it will be updated to ‘satisfied’). 

What steps do creditors take before issuing a CCJ? 

By law, a lender can only apply for a CCJ if they’ve already sent you a default notice and they’re unable to come to a solution with you. If they go down this route, you’ll receive a county court claim form in the post. You’ll normally be given 14 days to respond. (Though the exact deadline depends on the individual court).  

Be aware, if you don’t reply to a county court claim form before the deadline, your lender is likely to issue a CCJ - and you may end up having to pay more.   

Tip: If you receive court forms, you should seek free debt advice straight away. Organisations like StepChange and Citizen’s Advice, for example, can offer free, non-judgement advice. 

What options do you have with a CCJ? 

You can get a loan with a CCJ, though your options may be limited, and you may face higher interest rates.  

Some lenders tailor their products to people with a less-than-perfect credit history. At Ocean, for example, we work with a host of lenders who lend to those with bad credit.  

If you make your repayments on time, this type of credit could help you to rebuild your credit history over time. Just make sure you can afford the loan repayments on top of your current outgoings, before you apply. 

Bear in mind, the more time that has passed since the CCJ was registered, the higher your chances of approval. Especially if you’ve paid off the debt and maintained your bill repayments in more recent times. However, there are no guarantees of approval and each lender uses their own criteria. 

So, you may prefer to wait until the CCJ naturally drops off your credit history. Once it’s no longer showing on your report, you may have a higher chance of approval, with lower interest rates. 

How can a CCJ affect your employability? 

A CCJ may affect your employability in certain industries (like finance and law, for example). Employers will be able to see your CCJ if they run a soft search on your credit report as part of their background checks. This doesn’t mean you won’t be able to get a job, but it could make it more difficult to work in certain industries. 

Can you get a CCJ removed from your credit report? 

Yes, you may be able to get a CCJ removed from your credit report if you can prove that: 

• You paid the debt in full within 30 days of the CCJ being issued
• You disputed the CCJ and it was cancelled as a result 
• Six years has passed since the CCJ was registered (in which case it should’ve dropped off automatically)
• An insurance company was responsible for the debt, not you

You’d need to get in touch with the court that issued the CCJ to ask if it can be removed.