Saving Your Credit Score from Unforeseen Court Judgments
Is your creditworthiness at risk?
Your ability to borrow in the UK can be jeopardised easily without you even knowing.
Since the UK’s government lockdown in March, several individuals and business have reported that they have had a judgment registered against them in the courts and that they had not been notified of this until it was technically too late to be removed from the Register. With businesses abandon-ing their presence in the UK, or lapses in communication between parties due to the pandemic, some have not received requests for payment or invoices directly and only found out about a judg-ment when it was too late.
The problem is that even if you pay off the judgment debt, it may not be removed from your credit report. This would affect your ability to borrow and conduct business in the UK in future. Unless a CCJ is paid in full within 30 days of receiving the judgment, it will be entered on your credit record at the Register of Judgments, Orders and Fines. This record will remain there for six years and can seriously affect your ability to get a mortgage, a credit card or even a bank account in the future.
What to do
The best way forward in such situations is to get the other side to negotiate an agreement to settle the matter, and remove the judgment from your record by way of consent order. In our experience, most judgment creditors will agree to do so with some additional fees being paid across to them as after all, they have no desire to actually affect your credit score. The consent order is submitted to the judge for approval and in most cases, the courts are reluctant to intervene in the parties’ agreement and will approve the order to set aside the judgment by consent.
In certain circumstances however, especially where the judgment debt is of a high value, it may be best to obtain the creditor’s agreement to set aside the judgment by way of Tomlin Order. A Tomlin Order keeps the details of the settlement in the form of a confidential schedule e.g. the payment of the judgment debt and additional settlement fees. While the Judge may have access to the schedule, as the contents are technically not to be considered by the courts in its decision to approve the order. The judge would there-fore be less likely to query whether and why the judgment should be removed from the Register.
Thereafter, key credit agencies should be contacted and where appropriate, the process for removal of the judgment from your credit report should be undertaken in accordance with the agencies’ rules.
We have helped our clients to negotiate a settlement with their judgment creditors for the removal the judgment from the Court Register and clear their credit score quickly and efficiently. We can help you with the delicate process of setting aside and contacting key credit reference agencies so as to restore your creditworthiness and not further jeopardise your credit score.