Thinking about travelling outside the UK?
Unfortunately, here’s something you may not be aware of; if you move out of the UK with unpaid dues, you might be stopped at the airport before you even leave the country.
If you’re worried about getting in a similar situation, this article is perfect for you.
Let’s discuss all there is to know on this matter along with covering some FAQs.
Can I Leave the Country with Unpaid Debt?
In case of non-payment of your dues, the lenders will be keen to follow you everywhere. Even though credit card lenders don’t have the same influence outside the UK, a collection agency will be more than happy to follow you into the new country and get the debt back.
If you don’t plan on paying your debts, the lender could open a county court judgement which could help get them their money back. Moreover, if you leave assets behind in the UK, the creditor can also apply for a charging order which would cause additional problems.
The bottom line is:
You can leave the country with unpaid dues, but get ready to fight a fierce battle against the UK, your creditor and debt collection agencies.
Is a Debt Collector Allowed to Stop Me at the Airport?
A debt collector is only allowed to stop you at the airport if you are not providing a forwarding address. During the collection process, if you are moving away from the country, you must give a forwarding address to the people you owe money to.
It is sometimes better to do this as the creditors might not go after your assets this way.
In case you don’t tell your creditors where you are moving, a lot of problems can start from there for you. Especially if your creditor sells your debt to an agency.
Agencies usually have partner agencies in other countries that have jurisdiction in the given country. These partner agencies make sure that you pay the money back and can go to different lengths to get their debts back.
How Far is a Debt Collection Agency Allowed to Go?
It is hard to get the money back if you don’t have some assets in the country but consider this, if you aren’t moving for life, you will definitely have to come back at some point. At that point the additional fees and the interest payment on your debts would be higher than you left them.
An agency can go to any extent according to the laws of the country you have moved to. They will definitely go to court if they locate you and will try their absolute best to recover their debts. And by the time they get to you, your dues will be higher than before.
It is a very good idea to clear your credit cards and mortgage payments before you move away if you don’t want to go bankrupt.
What Does a Bank Do When Someone with Debt Leaves the UK?
If you leave without giving a forwarding address, banks will try to get their money back anyway they can. Banks usually have partner debt collection agencies that are good at their job. If the bank is affiliated with the state, they’ll have a lot more power to get their debts back.
Moreover, interest and additional payments will keep accumulating and if you do come back to the country, you’ll actually be worse off as compared to before.
Banks can also go after your assets in the country and use them as a payment for your debts. As you can probably tell, creditors don’t usually let their debts just slip out of their hands and something as simple as moving away is not a solution.
Can You Go to Prison for Debt?
You can’t go to prison simply because of unpaid dues.
Even then, this only happens if you avoid court hearings to explain your current financial status. The Magistrates’ Court can decide to waive off your dues once they get a chance to hear you explain yourself.
It is the annual fee charged by your local council for daily life local services that they provide. These services include the cleaning of trash, libraries and maintenance of roads etc.
If you fail to pay your monthly instalment of this tax, you will owe money to the council. This means that this non-payment will appear as a loan and they will try to get it back as soon as they can.
Collectively after you go to court, you will have to pay the tax, plus the bailiff fees and the court costs. This can be quite a heavyweight to drop on your pockets.
County Court Judgement
A CCJ is issued when you continue to avoid your debts. You have to appear in court and explain your financial status and choose a way to pay back the money. The money can be paid back to your creditor either in instalments or upfront.
There are multiple other options as well, for instance, your employer can be contacted and your dues could be cleared by a reduction from your salary, or you could have a charging order issued against your assets.
FAQs – Leaving the UK While on Debt
How long before debts become uncollectible in the UK?
For most types of loans, 6 years is the period after which they become unenforceable and cannot be collected.
What happens when I get back to the UK with debt?
The debt will keep accumulating interest and late fee payments and your situation will be a whole lot worse than where you left it. It is advised to not leave any debt hanging as court proceedings will ensue with or without you being there.
Can I move abroad to escape my debts?
No, you cannot.
Collection agencies buy your debt from lenders and can come after you using every resource they can. It is very rare for them to not be able to locate you even if you don’t give a forwarding address.
How do debt collectors find you?
Collectors often use their partner firms in other countries to locate you.
You can be located through your social media or if you get a job in another country, you can be found that way as well.
Can credit card debt follow me to another country?
Yes, in fact, in this case, the credit card’s issuers have a whole scheme in place to deal with unpaid dues and have partner agencies who can help with the collection process.
Taking loans can become a complicated matter if not handled correctly. Not paying them back results in a bad credit history and unhappy creditors who can cause a lot of court trouble.
It is advised that you seek help immediately from a professional who knows about the laws applicable in the UK so matters don’t get worse for you.
I hope this article helped you with your problem. If you have any questions, feel free to reach out.