Time order on an unsecured credit agreement

 August 2014

Fact sheet no. 06A

What is a time order?

A time order is a way of asking the court to give you more time to pay a credit agreement if you have fallen behind with the payments.  It can change:

  • the amount you have to pay each month; and
  • how long the agreement will last.

In some cases, the court can also make an order to change the interest rate.

Why apply for a time order?

Extra advice:

has the loan been called in?

Check if the whole loan has been called in.  See Has the creditor asked you to repay the whole agreement? later in this fact sheet.

If you have an ordinary credit agreement, you would not normally need to ask for a time order to be made.

If a creditor takes court action, you can apply to pay the judgment at a rate you can afford.  The court should take this into account when deciding what order to make.  Interest is normally frozen automatically on court judgments for agreements under the Consumer Credit Act 1974.

However, you may want to ask for a time order and for an order to freeze interest if an arrears notice or a default notice has been issued, but your creditor is refusing either to accept your offer of payment, or to freeze the interest.

If interest is still being added on to the debt and your creditor refuses to take court action, applying for a time order may be the only way to ask for the interest to be frozen.

If the court makes a time order and you keep up to date with the payments, your creditor cannot apply for a county-court judgment to be made.

This means a judgment will not appear on the Register of Judgments, Orders and Fines or on credit reference agency files.  However, the creditor may have registered the default on your credit reference file already when you fell behind with the payments.

What credit agreements are covered?

You can apply for a time order if your credit agreement is regulated by the Consumer Credit Act 1974.  Your agreement will be regulated if you borrowed less than the following amounts:

  • £15,000 if you took out your credit agreement before 1 May 1998.
  • £25,000 if you took out your credit agreement between 1 May 1998 and 5 April 2008.

There is no financial limit if you took out your credit agreement from 6 April 2008 (unless your loan was taken out for business purposes).

The agreement should have a heading that says: Consumer Credit Agreement regulated by the Consumer Credit Act 1974.