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Urgent advice needed for family member
petrimov
Posts: 6 Forumite
Hi everyone. I really hope someone can offer me some advice on this one.
A member of my family has gotten themselves into substantial debt (upwards of £35k). They are currently living and working abroad (UAE) and have been doing so for just over 3 years but they are still a UK citizen. They're are facing the loss of their job and the laws of the country they are living in mean they potentially face time in prison there.
Having contacted the UK arm of their bank and the CAB they have been told the following:
1. They've contact the UK arm of their bank and been told they are unable to transfer to loan over here as it exceeds the £25k limit on unsecured personal loans.
2. They cannot claim bankruptcy/IVA as they have been out of the country for over 3 years.
A debt advise agency (I'm not sure which one) have also told them that there's no further advice they can give.
Based on the above, can anyone recommend a course of action? Any and ALL responses are welcome.
A member of my family has gotten themselves into substantial debt (upwards of £35k). They are currently living and working abroad (UAE) and have been doing so for just over 3 years but they are still a UK citizen. They're are facing the loss of their job and the laws of the country they are living in mean they potentially face time in prison there.
Having contacted the UK arm of their bank and the CAB they have been told the following:
1. They've contact the UK arm of their bank and been told they are unable to transfer to loan over here as it exceeds the £25k limit on unsecured personal loans.
2. They cannot claim bankruptcy/IVA as they have been out of the country for over 3 years.
A debt advise agency (I'm not sure which one) have also told them that there's no further advice they can give.
Based on the above, can anyone recommend a course of action? Any and ALL responses are welcome.
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Comments
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When you say they face time in prison, is that because of the debt, or is it for some other reason? Are they in trouble at the moment, or is everything OK until they lose their job and fall behind with the loan?0
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Sorry, I should have clarified that one: it's because of the debt. Basically it is spiraling on account of very very high APR on his loan (a consolidation of other loans and credit cards). Right now is just making the payments but won't be able to soon, and the company he works for is making heavy redundancies.0
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I have absolutely no idea about the law in the UAE, so there isn't all that much useful help I could give - I guess the majority of people in this forum would be the same. If he is not in trouble at the moment, is he still free to leave the UAE? Could he get a job here and send money back to the UAE to pay the debt? Has he got any assets he could sell, or could a family member lend him enough money to get it down under the £25K limit (but then again, if he has no job & no assets, maybe they wouldn't let him transfer the debt anyway).0
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Hi there - I have just moved back from the UAE and have some knowledge of the situation out there.
It is a criminal offence to default on a debt there and you can end up in jail.
My advise, ethical or not, is to leave the country and deal with it from the UK. Do not even mention there is an issue to the local bank, or the police will be round before you can blink.
Once home, setup a payment plan or agreement with the bank.
To put this in some context, over 3000 cars have been dumped at the airport in the last 3 months in Dubai as expat lose their jobs due to the credit crunch. Local press of course wont mention this :rolleyes:0 -
StuTheDon,
Yes, unfortunately that seems to be the general view from what i've been reading on other sites and forums. What's hard to find out is what powers UAE debt collection agencies have in the chasing of bad debt abroad. Are you aware of anything in this area?
Thanks for your response.0 -
You've probably read this thread? It seems that he is certainly not the only one in this situation. It seems to imply that the UAE creditor would (or might?) pass the debt onto a UK debt collector, who would have the usual powers available in the UK, which would make sense.
http://britishexpats.com/forum/showthread.php?t=5835500 -
Petrimov - the answer is none. They have no power whatsoever in the UK, as they do not have jurisdiction.
Now, I am a huge advocate of paying off your debts. Whilst there may be a very good reason why your friend is in so much debt, I woudl question the reason given he/she is in a tax free country. It is very easy to live the high life out there, but if you cant reasonably save money out there then there may be a bigger issue in the UK. I really dont want to sound judgemental, as there might be a valid reason for it, but I think focus needs to be given to the reason so the same does not happen in the UK.
Now, if your friend has debt with a large global bank in Dubai like HSBC or Barclays, then it is possible that they will pass the collection to a UK subsidiary. They may somehow trace your friend, but I really cant see what they can do legally. As debt is a civil matter here there certainly wont be a criminal issue.
My advice stands - get out of the country asap, then contact the bank from the UK and offer a payment plan. So many people are leaving Dubai now that the banks will have their hands so full that they may never chase it up. Unethical possibly, but I'd rather that than end up in a Dubai jail.0 -
I've spent substantial amount of time in Dubai. I would agree with StuTheDon. and as for chasing debt abroad - you said your friend has contacted the UK arm of the bank meaning its a global bank and hence the chances are they would pursue in the UK (not sure how legal that would be). I've known a friend in similar situation and he had to spend 2 months in jail in dubai for his debt and then he left the country. The banks sent debt collectors to this other country where he moved to (they somehow managed to track him) and are now pursuing him to pay the debt. Again I'm not sure how legal all this is.0
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Thanks for your posts everyone.
My advice to him so far has been that he should not run from it. I am coming to the conclusion that, yes, he should leave the UAE, but that he needs to arrange a payment plan from here, as you suggest. Unfortunately the reality is that this is a result of a combination between inexperience in financial matters on his part, a materialistic nature and the apparent willingness in recent years for financial institutions out there to supply crazy credit to people who cant afford it, so there is obviously a risk of the situation tbeing repeated over here if he returns and hides from it. He needs to address the root cause - his spending habits - otherwise nothing will change, something we have been trying to get through to him for some time. It is just a shame it takes a situation like this, facing jail, for people to understand they have a problem.0 -
Petrimov - one last point. I assume he has a residency visa as he has been there 3 years. I would tell him not to cancel this as is normal before he leaves. Just leave the country and let the visa expire.
I have heard rumours that they check with banks etc before cancelling your visa which needs to be stamped on the way out. You wouldnt want the cops waiting at the departure gate!
Even better - get a flight out from Abu Dhabi as their systems are not linked :-)0
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