What to do about debt and going abroad

astitchingtime

I am at a loss as to what to do at present. My situation is that back in 2011 I was earning reasonably good money, self employed in the UK and was starting to save to buy the house I wanted in France within 3 years by working every hour I could. By December of that year I was diagnosed with Cancer and immediately began chemo etc which affected my ability to work and subsequently my income disappeared overnight. Apparently, as a self employed person, I had virtually no benefits that I could apply for. Because I had no income to take into account, housing benefit was £27 pw towards a £750 pcm rent!! I have three children, am a single parent and had to live on only child maintenance and child tax credits and also had to find money to pay for childcare for my 2 year old for the days I attended hospital. (It was only later I was told that there were some grants etc I could have had but by then it was too late).

So, I went from no credit cards, no loans, no debt whatsoever in November 2011 to 3 payday loans by middle of 2012 just to pay rent, feed and cloth the kids and get by. I felt I had no option but to open a catalogue account with Littlewoods and Very in order to purchase essential clothing and christmas gifts that year.

The long and short of it is, that I ended up in the typical cycle of taking out more payday loans to make payments of existing payday loans, all the time thinking I would be well enough to get back to work and earn what I used to. Unfortunately, it has taken up until now to be at that stage. Stupidly I tried to pretent the debts did not exist from about June of this year. I paid what I could, dodged and weaved in order to stay sane. At the end of the day in October, with interest having almost doubled what I originally owed to just over £7k I had to sort out a debt management plan. Silly thing is my income is now almost what it was. I have a total income of nearly £3k per month but almost half of this goes to pay of the debt and the other half I pay rent, food, bills and clothing, running the car which is essential to get the kids to 2 different schools 4 miles away. The calculations for my disposable income was made with the help of the National Debt Helpline where I was advised what was an acceptable expense and how much I was allowed for food etc per week. having being on this plan for 2 months only. The first month I managed, last month was hard and this month I have been unable to pay some of the creditors (I only spent £250 total on all three kids for christmas) because of the way it is worked out, I need to tax my car by 1st Jan but the allowance in the budget is a monthly £36 which is not enough to tax it. In addition, one child needed replacement shoes (cheaper ones were falling apart) and a decent pair of Clarks cost me £35, also the Water bill came in (again, allocated monthly and not enough to cover the bill this month). If I had 12 months to save these amounts I would be ok but everything has come in together.

I guess, you are wondering where the link to France comes in!! ;-)

Well, being self employed I have within the last week been presented with the opportunity of working in France for 12-18 months (with the possibility of it becoming permanent). I would love to do this, the kids want to do it and it was our dream until i was ill. From what I understand, i may no longer be entitled to claim Child Benefit and/or tax credits and so will be reliant solely upon my income and child maintenance. Having done some calculations, this will mean for that time my income will be lower but without debts to pay, more than enough to have a comfortable standard of living. That means, either I go there and still struggle like hell like I do here or do something drastic!

My questions are:

If I contact all of my creditors and tell then I am going abroad for an indefinite period and provide them with my address (like I am legally obliged to do), would I get away with re-jigging the DMP so that I am paying something but not leaving myself and the kids in a dire situation. If I did this, and simply rewrote the plan, TOLD them what I will be paying and continue to make those payments, can they do anything about it, as they will be getting something? I read on a forum somewhere that the French are not particularly helpful with pursuing UK debtors living in France for UK creditors. I am also led to believe that obviously as I am making a payment I am not avoiding the debt but if they are not happy, as I am not resident in the UK anymore, they cannot apply for a CCJ?!??!? OR

Do I simply disappear (because with what I do, I can do it anywhere from home so once I am installed in France I do not really need to come back anyway). I know many people will say I should be responsible, which I am trying to do but £4000 of my debts are payday loans and I have done calculations on those. My original loans totalled £2600, I have more than paid the loans and interest many times over so what is really outstanding is just interest incurred by rolling over the loans becuase I could not repay in full. The other £3500 is owed to Shop Direct and again around 50% of that is actually interest anyway.

If I just move and don't tell them, I know debt collectors will probably turn up here (which is not pleasant for the new tenant) but will they actually bother to chase me in France? I realise that interest may be added and if and its a big IF I did ever come back, my debts may be higher but I would hope by then I have managed to save something with which to pay.

It is just that this is a chance of a new start for me and the kids. We have all struggled over the last 2 years because of the illness and now because of the finances. Part of my dilemma is moral and part is practical, I hope someone can help me figure it out.

jojitsui

I can't offer advise on your financial situation but just wanted to wish you all the best

astitchingtime

jojitsui wrote: »

I can't offer advise on your financial situation but just wanted to wish you all the best

Thank you! I may need it!

Asiacat

Hi,

I live in Thailand where there are many expats who have left the UK leaving debts behind.

I didn't have any debts when I left the UK but know of a few people who did.

It all depends on whether there is a reciprocal agreement regarding debt collection in your new country of residence.

In Thailand there isn't, however most people running from debts go broke over here with no lines of credit available and 90% of them end up back in the UK with bigger financial problems than they left behind.

I don't know about France but suspect that there will be something in place for European Community countries. You will need to check this out. It may be that they can sell the debt to a French collection agency.

If you do run from your debts and need to come back to the UK you will bigger problems than when you left.

FBaby

astingshintime, you seem to have experienced really difficult time and I admire you for keeping your head over water and your family together. So you got into debts during very challenging times. It really is not the end of the world in the scheme of things.

However, from what you've written, I do wonder whether your intentions to move to France are well thoughts rather than closing your eyes to reality and wanting to experience a dream. Have you done all your research in terms of what living in France would entail? My first thought was your health. I'm sure you know that you don't get free healthcare in France, and with you being self-employed, it is unlikely you will be covered. Just recovering from cancer, your premium for private cover will be very high. Don't assume you could just come back to England and get automatic care. In addition to having to unsettle your kids again if you needed to, you might actually find that your local hospital would refuse to treat you under the NHS if they believe you are still living in France.

As for the debts... ask yourself? Would you really be able to enjoy your life always wondering what is happening to your debts. Even if you manage to put a stop to them, how will you feel if you do need to come back to England, most likely because you need to financially or for health reasons, and you would need to face your debtors again at a time you would least need that stress.

Is your ex supportive of you moving to France? How will you ensure your children still have contact with him especially if they are still very young? I've been in your exact same shoes and was 6 months away from moving to France 5 years ago. In the end, destiny had something else for me as just when my plans were getting more sound (after more than 12 months planning), I met the man who has become my husband this year. We will be moving to France one day, just not yet.

Whatever you do, I do wish you good luck, or like they say in France, good courage.

astitchingtime

FBaby wrote: »

astingshintime, you seem to have experienced really difficult time and I admire you for keeping your head over water and your family together. So you got into debts during very challenging times. It really is not the end of the world in the scheme of things.

However, from what you've written, I do wonder whether your intentions to move to France are well thoughts rather than closing your eyes to reality and wanting to experience a dream. Have you done all your research in terms of what living in France would entail? My first thought was your health. I'm sure you know that you don't get free healthcare in France, and with you being self-employed, it is unlikely you will be covered. Just recovering from cancer, your premium for private cover will be very high. Don't assume you could just come back to England and get automatic care. In addition to having to unsettle your kids again if you needed to, you might actually find that your local hospital would refuse to treat you under the NHS if they believe you are still living in France.

As for the debts... ask yourself? Would you really be able to enjoy your life always wondering what is happening to your debts. Even if you manage to put a stop to them, how will you feel if you do need to come back to England, most likely because you need to financially or for health reasons, and you would need to face your debtors again at a time you would least need that stress.

Is your ex supportive of you moving to France? How will you ensure your children still have contact with him especially if they are still very young? I've been in your exact same shoes and was 6 months away from moving to France 5 years ago. In the end, destiny had something else for me as just when my plans were getting more sound (after more than 12 months planning), I met the man who has become my husband this year. We will be moving to France one day, just not yet.

Whatever you do, I do wish you good luck, or like they say in France, good courage.

Hi, I appreciate what you say. yes I guess it is a little about running away and living the dream but to be honest, after Cancer claiming 2 years of my life and putting my in this s**t, I feel this may be the closest I get to it.

I have done extensive research on cost of living there etc. I would have help with relocation expenses. Healthcare quote I had for the 4 of us including cancer cover was £200 a month (do-able).

I did ask in my OP about the scenario: If I tell my creditors I am in France and provide my address but also tell them that my income has reduced and offer a lower payment to the one they get now. At least I am paying something; I get to sleep at night; but if they don't accept it and are not happy, can they still raise court proceedings or harass me? My understanding is that they cannot unless I am resident in the UK and if I am making some payments, will they really bother? I realise that they may continue to add interest but at least me and the kids get to breathe for a while.

astitchingtime

FBaby wrote: »

astingshintime, you seem to have experienced really difficult time and I admire you for keeping your head over water and your family together. So you got into debts during very challenging times. It really is not the end of the world in the scheme of things.

However, from what you've written, I do wonder whether your intentions to move to France are well thoughts rather than closing your eyes to reality and wanting to experience a dream. Have you done all your research in terms of what living in France would entail? My first thought was your health. I'm sure you know that you don't get free healthcare in France, and with you being self-employed, it is unlikely you will be covered. Just recovering from cancer, your premium for private cover will be very high. Don't assume you could just come back to England and get automatic care. In addition to having to unsettle your kids again if you needed to, you might actually find that your local hospital would refuse to treat you under the NHS if they believe you are still living in France.

As for the debts... ask yourself? Would you really be able to enjoy your life always wondering what is happening to your debts. Even if you manage to put a stop to them, how will you feel if you do need to come back to England, most likely because you need to financially or for health reasons, and you would need to face your debtors again at a time you would least need that stress.

Is your ex supportive of you moving to France? How will you ensure your children still have contact with him especially if they are still very young? I've been in your exact same shoes and was 6 months away from moving to France 5 years ago. In the end, destiny had something else for me as just when my plans were getting more sound (after more than 12 months planning), I met the man who has become my husband this year. We will be moving to France one day, just not yet.

Whatever you do, I do wish you good luck, or like they say in France, good courage.

Oh and as for my ex. He already lives 300 miles away and only visits every 4 or 6 weeks. He lives near a ferry port which goes directly to the north of France where we would be so cost and time, it would not be much different for him to travel there. (ironically, when we married we both had £60k incomes, he now has £100k + his new wife's income but moans about every penny he has to pay in maintenance!!) Some people need a bit of Karma more than others me thinks!

happy_bunny_2

If you stop paying and vanish, they are likely to get a CCJ at your last known address. These will be waiting for you if you return. Valid for 6 years, but can be refreshed, especially if you just left the country.

Can you talk to national debtline about your budget? You on a self managed DMP?

You can also redirect your mail abroad via Royal Mail, for up to 2 years I think. This might be useful also.

astitchingtime

happy_bunny wrote: »

If you stop paying and vanish, they are likely to get a CCJ at your last known address. These will be waiting for you if you return. Valid for 6 years, but can be refreshed, especially if you just left the country.

Can you talk to national debtline about your budget? You on a self managed DMP?

You can also redirect your mail abroad via Royal Mail, for up to 2 years I think. This might be useful also.

Thanks happy bunny! I did get advice from the National Debt Helpline in October, who went through a income and expenditure form with me item by item and sent me standard letters etc to use. I therefore sorted out the DMP on my own.

I found some information about a reciprocal agreement within the EU:

EEO Regulation
This is the method of choice as it enables simple, quick enforcement within the EU. It can be used for money judgments obtained for uncontested claims. It should usually be used, when possible, in preference to other regimes which take longer and which are more complicated.
The EEO Regulation can be used if the debtor:
agreed to the debt, and this has been approved by the court in a consent order;
did not defend the claim at all, so there is a default judgment;
did not defend the claim in court when it was tried.

It basically seems that if a CCJ is obtained in the UK and the debtor is in a country covered by the EEO, yes the creditor can enforce just as if they were in the UK.

I want to do the right thing and tell them where I am going but my payments will have to be reduced. My fear is that this will upset them and they will go ahead and get CCJs etc anyway in my absence and then still harass me over there. I just need some breathing space for a while. I have struggled through cancer treatment alone and the result is debt which is also a struggle and I just need a bit of space to get my life back on track.

So now me is thinking either:

1. Don't tell them I have bugg**ed off but tell them that my income has reduced therefore my payments are reducing and continue to pay the reduced payments as proposed as per my new income over there and have my mail (like you suggest) diverted. OR

2. Just bugg*r off and say nothing.

I realise that CCJs may be waiting for me back here in the UK should I return but to be honest, I am planning in such a way that I don't return. If I did not have the debts, we would live in France comfortably and within about 4 years I could save enough to buy a small house outright over there. I will never be in a position to own my own home here now.

I know plenty of people say pay what you owe and if I thought the creditors would be a little more reasonable, I would keep paying every penny even if it meant doing it for the next 5-6 years but I suspect they will keep adding interest (with my current plan it will take about 14 months but it is another 14 months of struggling with petrol prices rising, food bills increasing and there is no contigency in the current plan for emergency car repairs etc).

It pi***s me off that I have worked and paid tax in this country since I was 16, I have never had major debts, I have worked hard and earned probably well over a million in my lifetime and paid plenty of tax and the main reason I ended up in debt was there was very little help for me benefits wise when I needed it!

:mad::mad::mad:

happy_bunny_2

What's your total debt amount?

If your income has reduced, then you are telling them the truth and can vary the payment offer accordingly.

Creditors are less likely to go for a CCJ if they are being paid and feel they can get no more via court.

Ultimately, it's up to you what you decide, but I'd redirect your post as that at least keeps an eye out for Court claims for a couple of years in case you change your mind.

Good luck

HB

onamissionEU

Generally speaking if your debts are unsecured and relativly small most creditors would sell the debt to a debt collection agency (DCA). They will then hound you at your last known address for payment. CCJ's are generally a last resort and for smaller debts are not the prefered route for lenders.


Would you still have an address available to you in the UK should you move? Perhaps a parental home etc? I would advise AGAINST bu55ering off without trace as this is very likely to back fire on you. If you have a correspondance address available to you, pass this on to your creditors (there is no such thing as a blacklisted property so you need have no concerns about affecting anyone else's credit scores etc).


Your best course of action would depend of several factors, the most important being wethere or not you have been defaulted on any debts. If no and you wish to keep a "clean" credit report you would need to continue to make your contractual payments as usual. I get the feeling you have already been defaulted; in which case your credit file is already screwed for 6 years. This being the case I would suggest the following:

Write to your creditors informing them you have a new address for correspondance and inform them that you have had a chance of circumstances and that you would like to request a freeze on interest payments. Offer token payments of 1 pound per month. They will likely want a statement of affairs from you. Once you have no income (in GB) you can let them know this but do not mention you are living abroad / have income there. This will buy you time.


Usually after defaulting you, credit cards etc will pass/sell on your debt to a DCA. This is where it gets interesting. Once a DCA owns the debt you are in a position to negotiate payment. If you can raise lump sums, you can offer partial settlements (search this board for threads) where you may be able to pay off debts at a % of original debt, usually around 40%, depending on circumstances. In the mean time, keep paying token payments. This buys you time and gives you the chance to pay a much reduced amount to become debt free.


It is very important not to just ignore your creditors as this will backfire but given time and communication the above is a strong possibility. I repeat though, you will need a UK address and under no circumstances tell them you are abroad / give them your French address.