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What happens to debts in UK when moving to Canada?

What happens to debts in UK when moving to Canada?

Old Oct 22nd 2014, 2:00 pm
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Default What happens to debts in UK when moving to Canada?

Hello there,

My husband, myself and 2 children are looking at relocating to Red Deer, Alberta in Canada.

This is my first post as I am new here! So if I get anything wrong I do apologize in advance. We have old credit card debts, catalogue debts and old bank accounts that were maxed out in overdrafts and we are now paying it all back still. It won't be clear for another couple of years atleast so I'd like to know.

- Can we still relocate and move to Canada?
- What happens with our old debts?

I just don't want to get us into trouble really but I have no idea where we stand. If anyone can help please do or point us in the right direction please?

Thanks.
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Old Oct 22nd 2014, 2:02 pm
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Default Re: What happens to debts in UK when moving to Canada?

Originally Posted by MrsMorgan
Hello there,

My husband, myself and 2 children are looking at relocating to Red Deer, Alberta in Canada.

This is my first post as I am new here! So if I get anything wrong I do apologize in advance. We have old credit card debts, catalogue debts and old bank accounts that were maxed out in overdrafts and we are now paying it all back still. It won't be clear for another couple of years atleast so I'd like to know.

- Can we still relocate and move to Canada?
- What happens with our old debts?

I just don't want to get us into trouble really but I have no idea where we stand. If anyone can help please do or point us in the right direction please?

Thanks.
The debts remain.

If you continue to pay them; no issues will arise. If you choose to stop paying them, your creditors may, or may not, choose to chase you for them in Canada. It is relatively easy for them to do so.

You know what you should do.
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Old Oct 22nd 2014, 2:09 pm
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Default Re: What happens to debts in UK when moving to Canada?

Welcome to BE

Typically you need to demonstrate a certain amount of settlement funds when landing. For 2+2 its currently about $22k. Not to mention all the other costs associated with immigration before you get there... These are suposed to be unencumbered funds, not borrowed. How they would know beats me. Personally I think the amount required low if its really intended to set you up and keep you going for 6 months.

If you leave debts behind it will screw up your credit rating should you end up returning to the UK. As you start from zero in Canada it likely wont impact canadian credit worthiness. You may think you wont ever go back, but many people do once reality bites.

Second, the debts will be passed on to a debt collection agency, who may pursue you to Canada if the amount is large enough to be worth the hassle. Most banks etc want to avoid that hassle and will likely be open to negotiation regarding how much to pay back and how often. They would rather have something than nothing.

There are quite a few threads of this nature in the archive, and they typically end up with outraged posters complaining about debt defaulters but most people that do it seem to get away with it...

Last edited by iaink; Oct 22nd 2014 at 2:14 pm.
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Old Oct 22nd 2014, 2:35 pm
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Default Re: What happens to debts in UK when moving to Canada?

I don't want to leave them unpaid.


I'm not planning at all to do this I actually wanted help and advice as to where I stand and how can I continue to pay whilst in Canada with a different form of money. My husband has a job offer waiting and we currently have a repayment plan already in place where we pay them off a certain amount be it £20-£30 each month in the result of clearing them all off. We made the debt and it is ours to repay. None of them have silly amounts of interest on so we're basically paying what we owe so I have every intention or carrying this on. We got ourselves in that mess so we shall pay our way to get out of it! I don't want to leave them behind or not pay them I just was unsure if we could still move with having these debts in the UK that's all.
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Old Oct 22nd 2014, 2:42 pm
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Default Re: What happens to debts in UK when moving to Canada?

Yes you can move with a debt

As far as paying from Canada it's not made easy, prob best to keep a UK account open and transfer larger amounts of cash every 6 months to cover payments.
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Old Oct 22nd 2014, 2:49 pm
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Default Re: What happens to debts in UK when moving to Canada?

Keep in mind if you're transferring money back it's going to cost you a lot more to clear them given the exchange rate. Can you not pay them off before you go in some way? You will need all your money when you get to Canada....so many things to replace etc
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Old Oct 22nd 2014, 3:48 pm
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Default Re: What happens to debts in UK when moving to Canada?

If you have a job offer in place, does anyone know if you have to demonstrate a certain amount of funds to sustain yourselves? If you are paying off your debts using money earned in Canada, as Tirytory says, it's an expensive way of doing it because of the exchange rate.
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Old Oct 22nd 2014, 4:04 pm
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Default Re: What happens to debts in UK when moving to Canada?

Originally Posted by rivingtonpike
If you have a job offer in place, does anyone know if you have to demonstrate a certain amount of funds to sustain yourselves? If you are paying off your debts using money earned in Canada, as Tirytory says, it's an expensive way of doing it because of the exchange rate.
With a job in place the landing funds are waived.



I agree that the most efficient way to keep paying UK payments is to maintain a UK account and top it up with reasonable sums now and then in order to minimise transfer fees and Fx rate losses.

For smaller amounts something like paypal / e cheques/ would be workable, sending money from yourself to yourself, but the exchange losses are going to add up.

The best bet though might be to negotiate a once and for all lump sum settlement before leaving the UK.
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Old Oct 22nd 2014, 6:13 pm
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Default Re: What happens to debts in UK when moving to Canada?

I would consider setting up a payment plan with your creditors, maybe checking with citizens Advice. Another option is if you dont have any secured debt is to claim bankruptcy in the UK i know someone who did this, from Canada. I would seek proffessional advice from a credit counsellor

Last edited by allycat231; Oct 22nd 2014 at 6:17 pm.
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Old Oct 22nd 2014, 6:18 pm
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Default Re: What happens to debts in UK when moving to Canada?

Originally Posted by allycat231
I would consider setting up a payment plan with your creditors, maybe checking with citizens Advice. Another option is if you dont have any secured debt is to claim bankruptcy in the UK i know someone who did this, from Canada. I would seek proffessional advice from a credit counsellor
Ugh....Not exactly fair or wise advice...
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Old Oct 22nd 2014, 6:32 pm
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Default Re: What happens to debts in UK when moving to Canada?

Originally Posted by Tirytory
Ugh....Not exactly fair or wise advice...
They asked a question so I answered, im not telling them to do it, thats why I said they should seek proffesional advice!
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Old Oct 22nd 2014, 6:53 pm
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Default Re: What happens to debts in UK when moving to Canada?

Originally Posted by allycat231
Another option is if you dont have any secured debt is to claim bankruptcy in the UK i know someone who did this, from Canada.
They don't need to see a credit Councillor to find out that is a really bad idea. Bankruptcy will follow you for a long time, no matter where in the world you are. Some jobs ask if you have ever been declared bankrupt, not specific to any country.

One cannot just declare bankruptcy by choice, you actually have to be and prove insolvency and be declared bankrupt by the court. In addition, everything you own and earn is under scrutiny or the bankruptcy trustee, you life is not your own for a long time to come.
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Old Oct 22nd 2014, 8:07 pm
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Default Re: What happens to debts in UK when moving to Canada?

Catalogue debts? They probably won't come after you so I wouldn't bother paying them. And even if they do, you can offer them some low amount which they'll accept cos they won't get shit if they sell the debt to some shady collection company.
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Old Oct 22nd 2014, 10:13 pm
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Default Re: What happens to debts in UK when moving to Canada?

I hope you are expecting a generous relocation package, as moving to Canada is a VERY expensive undertaking. If you already have debt, are you sure this is a burden you can manage? Just the setup costs are eye watering, never mind the freight costs, flights, immigration stuff etc etc.

Good luck though. I wish you well whether you chose this path or not.
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Old Oct 22nd 2014, 11:04 pm
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Default Re: What happens to debts in UK when moving to Canada?

Originally Posted by Almost Canadian
The debts remain.

If you continue to pay them; no issues will arise. If you choose to stop paying them, your creditors may, or may not, choose to chase you for them in Canada. It is relatively easy for them to do so.

You know what you should do.
Nah, not possible due to legal jurisdictions. They could chase you but they could never take the money from assets in a different country,
They will try and then after 6 years, the debts will cease to exist as they timeout legally.
How much is the debt?
To pay from Canada, just transfer funds using something like UKForex once per month.

Last edited by Scribble; Oct 22nd 2014 at 11:08 pm.
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