How to Pay a Court Judgment by Instalments

Having a court judgment entered against you can be daunting — especially when the order says you must pay immediately and you simply do not have the money. The good news is that you have the right to apply for an instalment order. Form N245 allows you to ask the court to let you pay the judgment in affordable monthly payments, based on what you can realistically afford. This guide explains how it works.

When Can You Apply?

You can apply to pay by instalments in several situations:

• After a default judgment — if the claimant obtained judgment because you did not respond to the claim, and the judgment orders immediate payment
• After a hearing — if the court ordered you to pay after a trial or hearing
• When enforcement has started — if the claimant has applied for a warrant of control (bailiffs), attachment of earnings, or other enforcement, you can apply for instalments and ask the court to suspend the enforcement action
• To vary an existing instalment order — if your circumstances have changed and you can no longer afford the current payments

What the Court Considers

The court decides your instalment amount based on your disposable income — the difference between your income and your essential outgoings. Form N245 requires you to provide a detailed financial statement covering:

Income

• Wages or salary (take-home pay)
• Benefits (Universal Credit, Housing Benefit, Child Benefit, etc.)
• Pension income
• Income from any other sources
• Your partner's income (if applicable)

Outgoings

• Rent or mortgage payments
• Council tax
• Gas, electricity, and water
• Food and housekeeping
• Travel and transport costs
• Childcare costs
• Insurance (home, car, etc.)
• Existing debt repayments (credit cards, loans, hire purchase)
• Any other essential expenses

Dependants

You must state the number of people who depend on your income — children, a partner who does not work, or other dependants. The court takes dependants into account when deciding what you can afford to pay.

How to Propose a Realistic Payment

The key to a successful N245 application is proposing an instalment amount that is realistic — both for you and in the eyes of the court. Here are some practical guidelines:

• Calculate your disposable income — total income minus essential outgoings. This is the maximum the court will expect you to pay
• Offer what you can genuinely afford — do not offer more than you can sustain. If you miss payments, the claimant can resume enforcement
• Be reasonable — the court will look at your figures and may increase the instalment amount if your expenses seem inflated. Include only genuine, necessary expenses
• Consider the claimant's position — the claimant is owed money and is waiting to be paid. Offering £5 per month on a £5,000 debt (which would take over 80 years to pay) is unlikely to be accepted. Aim for a balance between what you can afford and what is reasonable given the debt

What Happens If You Do Not Apply

If you have a judgment against you and do not pay — and do not apply for instalments — the claimant can take enforcement action. This can include:

• Warrant of control (form N323) — the court authorises bailiffs to visit your home or business and seize goods to sell to pay the debt
• Attachment of earnings order — the court orders your employer to deduct money from your wages and pay it directly to the claimant
• Third-party debt order — the court freezes money in your bank account and orders the bank to pay it to the claimant
• Charging order — the court places a charge on your property (like a second mortgage), meaning the debt must be paid when the property is sold

These enforcement methods can be disruptive, stressful, and embarrassing (particularly bailiff visits or wage deductions). Applying for an instalment order is almost always a better option than ignoring the judgment and waiting for enforcement.

How to Fill In Form N245

Form N245 is titled “Application for suspension of a warrant and/or variation of an order”. Despite the title, it is the standard form for applying to pay a judgment by instalments. Here is what you need to complete:

• Case details — your claim number, the names of the parties, and the court where the judgment was entered
• The order you are applying for — state that you want to pay by monthly instalments and propose the amount
• Financial statement — this is the main part of the form. You must list all your income, all your outgoings, your dependants, any assets (savings, property, vehicles), and any other debts you owe
• Statement of truth — you must sign to confirm the information is true

What Happens After You File

After you file form N245, the process depends on whether the claimant accepts your proposal:

• If the claimant accepts — the court makes an instalment order based on your proposal. You start making payments as agreed
• If the claimant does not accept — the application is referred to a district judge, who reviews your financial statement and decides what you should pay. The judge may order a different amount based on your means
• If enforcement is already in progress — the court may suspend the enforcement action (for example, recall a warrant of control) while the instalment application is being considered, provided you can show you are making reasonable efforts to pay

Common Mistakes to Avoid

• Ignoring the judgment — this is the worst thing you can do. The debt does not go away, and enforcement action will follow. Apply for instalments as soon as possible
• Offering too little — while the court will consider your means, offering an unrealistically small amount (e.g. £1 per month on a large debt) without justification may be rejected. Be honest about what you can afford
• Inflating expenses — the court is experienced in reviewing financial statements. Claiming unusually high expenses will raise suspicion and may result in a higher instalment order than you proposed
• Forgetting to include all debts — if you have other debts you are paying, include them. The court needs the full picture to set a fair instalment amount
• Not providing evidence — while not always required, attaching payslips, bank statements, or benefit letters can strengthen your application, especially if the claimant disputes your figures
• Missing payments after an order is made — if you miss even one or two payments, the claimant can apply for enforcement. Set up a standing order to make sure you never miss a payment

Fees

There is no court fee to file form N245 if you are simply applying to pay by instalments (varying the terms of payment). If you are also applying to suspend enforcement action (for example, to recall a warrant of control that has already been issued), the court fee is currently £14.

Frequently Asked Questions