How do I respond to a claim I can't afford?

I owe the debt claimed but can’t afford to pay – what should I do?

If court proceedings have been commenced against you for a sum of money, but you cannot afford to pay the debt, it is important not to ignore the claim. If you fail to respond, the amount of the debt is likely to increase as costs and interest mounts up.

Importantly, if you do not respond, the claimant will probably have judgment entered against you by default. This means the claimant automatically succeeds in their claim, and you will have a County Court Judgment entered against you. This could then lead to Bailiffs turning up at your property to seize your goods, and/or the claimant (your creditor) obtaining an order for sale (if you are a property owner).

How do I respond to Court proceedings?

If you admit you owe the debt (or at least some of it), you should send an ‘Admission’ to the court using the form supplied. If you did not receive an Admission Form N9A, a copy can be obtained from the Court or from the Court Service’s website.

When should the Admission be sent to the Court?

This must be sent to the Court within 14 days of you being served with the proceedings. The date upon which you were considered to have been served with the proceedings may be different from the date on which you actually received the proceedings. If in doubt, telephone the Court in which the proceedings were commenced, quoting the Claim Number printed on the Claim Form, to find out how long you have to send the admission.

What if my Admission is sent late?

If you fail to send the Admission form to the Court on time, judgment could be entered against you in default. If this happens, the amount of the debt is likely to increase.

If you have already missed the deadline for sending an Admission to the Court, you should still complete and send it (or preferably hand deliver) to the Court without further delay as the Claimant may not yet have applied for judgment in default.

How do I complete the Admission?

You must provide details of your income and outgoings, and you will have the opportunity to say when you will be able to pay. You may be able to make payment in full on a certain date, for example, your next pay date. If you cannot pay before that date, you should briefly explain why.

Alternatively, you can offer to pay by instalments – stating how much you can afford to pay each month. If your income is low, and you can only offer to pay by small instalments, the more information you provide about your income and outgoings the greater the chance your offer will be accepted.

However, an offer to pay by instalments should be realistic. If you offer to pay more than you can really afford, and you miss an instalment, you could find yourself having to pay the amount in full in one go, less any amounts you have already paid.

Where should I send the Admission?

The Admission form should be sent to the Court where proceedings were commenced (this will be shown on the Claim Form, together with the Court’s address).

A copy of the Admission form should also be sent to the Claimant (or their solicitor if they have one). The claimant’s or solicitor’s address for service will be found on the front of the Claim Form.

What if I can’t afford to pay anything?

If you cannot afford to make any realistic offer to pay off the debt, you should seek urgent advice as to what you should do. If you make no payment proposals, the claimant can ask the court to decide the rate of payment.

Can I make an offer to settle the claim for a smaller amount than what is claimed?

Claimants usually prefer to receive a lump sum, even if it is less than the amount of the debt, rather than having repayment of the debt by instalments over a long period of time. If you are in the position to offer a lump sum in satisfaction of the claim, it is certainly worth making such an offer to the Claimant. Contact the claimant (or their solicitor if they have one) by phone, or email or in writing.

If you intend borrowing a lump sum from a friend or relative, you should explain to the Claimant or their solicitor that this is the case, so they understand that the money in question is only available if your offer is accepted. Make an offer to settle the claim as soon as you can.

Do note that the claimant can reject your offer proposals, although they will need to consider whether the offer is reasonable before rejecting it. If your payment proposals are rejected, (or if you make no payment proposals) the claimant can ask the court to decide the rate of payment.