The Purpose of a County Court Claim

If you owe money to a creditor they can take a county court action against you to try and retrieve it. If you have the money to immediately repay the debt then it's possible to avoid the court hearing by settling in full. If this is not possible then there will be a court hearing in private which it is not compulsory for you to attend but you may if you wish. You will not be found guilty of anything just whether you owe the money or not.

The court will send you a claim form showing exactly how much the creditors claim you owe them. This form also gives you the opportunity to explain your situation to the court. On a part of the claim form there is a section that will ask you about your incomings and outgoings, in this section you can offer to repay the debt, or if you think you owe a lower amount you can offer to repay that. If however you refuse to make an offer and the court sees in your creditors favour you will be made to pay either the full amount of monthly payments until the debt is paid off.

Once the court hearing is finished the court may issue you with an order this is known as a CCJ (County Court Judgement) the amount of this will be agreed by yourself and the creditor/s involved, if however you cannot agree on this then the amount will be determined by the court. If there are more than one creditor then the court is likely to issue an administration order that will combine your debts this is usually a single monthly payment to be shared by your creditors. In most cases you will pay the creditor who has made the claim against you or sometimes that will have a representative who you can pay on their behalf, usually a solicitor.

If you do not keep up with your payments the creditor is likely to  get the court to take steps to get you to pay and invariably this will include court costs. So if at any point you realise that you cannot afford to pay even in stages, you must act quickly and notify the court straight away to see if it's possible to either change the amount of the monthly payments or   alternatively suspend them until you can afford to pay.

The CCJ will stay on your record for 6 years unless you pay the full amount within a month, bear in mind that the banks, building societies and other major lenders will use this as reference to  decide whether you are an acceptable client for a loan, mortgage or credit of any description.

You may be in a situation where you disagree with the CCJ. In this event it is possible to request that the court does not apply for the CCJ immediately though you are likely to incur a cost for this. It is however imperative that you have a genuine reason for doing this or it could be deemed to be wasting the court's time or in the worst case scenario perjury which is punishable with a fine or in the most extreme cases a term of imprisonment.