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.

Thanks for reading my novella!! Part of my dilemma is moral and part is practical, I hope someone can help me figure it out.

Novocastrian

I'm not taking this on.

I'm an NUFC supporter and my team currently wears shirts with a WONGA logo.

That's embarrassing enough, but all the players are French too.

Vive les Plies!

But to respond to the post, I don't think you can escape your debts by relocating to France.

Think again.

Nectarine

I think it's a very brave posting and you've been very honest, but here's my two -cents worth. You've got into a muddle in the UK and the opportunity presents itself for a fresh start in France, which sounds like a dream come true. But, here's the but - what is your spoken French like? You have to settle the kids in at school ... do they speak French? If your car isn't taxed in the UK then it won't be legal to drive, and it costs money to register it in France. You will have removal costs, etc., to move to France. How will you manage with healthcare, you may not be eligible. If you went back to the Uk would you face any legal proceedings for debt recovery?
France probably seems like a shining beacon of hope and new beginnings, but you could easily find yourself in the same situation, but dealing with everything in a foreign language.
In your shoes, I'd take a deep breath and I wouldn't make a fresh start until I could cut all ties, with a clean conscience, with the UK. This will concentrate your mind on a new start, without the worry of the debts you've left behind.
Cut your costs (sorry, but £250 for Xmas presents is, in my view, ridiculously high!). Cut back on everything, buy the kids' clothes from good charity shops or hand-me-downs, nobody will ever know the difference. Look around and see what you can save (you might be surprised). Then pay back every debt (it's only fair to the people who've lent you money, you wouldn't want a debtor doing a runner on you), then save hard. Meanwhile, learn French, get the kids to learn French.
And then when you do come to France, you can do so with a positive attitude, a clean conscience and real hope in your heart because you're moving towards a future, instead of running away from the past.
Good luck.

cyrian

Hi
You also need to consider your healthcare.
Normally, the UK continues to cover your (and your dependants) healthcare for around 2 years in another EU country. If you are employed in France then your Social Charges (NIC) provide you with cover.
Be warned that the Social Charges in France for self-employed are very high and you need a higher "top line" just to have the same take-home.
However, you also have to have a "top-up" mutuelle insurance to cover the ~30% of healthcare costs that the State system doesn't cover.
In addition, France is more strict regarding debt than the UK. e.g. if you write a cheque which bounces then you can be banned from the french banking system for a number of years.
In the UK, you can get advice from a number of organisations and in your own language. Where would you get similar advice in France and would you be able to explain your complex affairs in french and understand the replies?
Sort your affairs out first - good luck

EuroTrash

Hi, you've had a rough time and I am sympathetic but I agree with the two previous posts, for a number of reasons. (EDIT: 3 posts now!)

Firstly, have you double-checked your financial projections? In practice, not many people find it easier to earn a living in France than in the UK. It's not so much about the UK benefits you would be losing (in fact, once you're in the French system you should be entitled to child benefit which I believe is higher than UK child benefit). The issue is that the costs of being self-employed in France are massively higher than in the UK. Hopefully you have taken this into account in your calculations, because if you simply transplant a business from the UK to France - similar volume of work, similiar pricing structure, similar overheads - you will have far less disposable income in France because of French social security cotisations and business taxes and, depending on your activity, tighter controls as regards obligatory professional insurances etc. Depending on which business regime you register under, typically you should expect to hand over roughly 40 per cent of your profit to the State. Of all the EU states, I believe France has the highest taxes and is probably the least small-business-friendly, as compared to the UK which has one of the lowest tax rates and is generally viewed as one of the easiest places to start and run a business. (Incidentally, I've been self-employed here for many years and before that I was self-employed in the UK, so I do speak from experience.)

Another living expense that you don't have in the UK is healthcare for you and the kids, because healthcare is not free at the point of delivery in France. If you are in the State system you have to meet on average around 30 per cent of the cost, or pay monthly into a top-up insurance scheme.

If you have built all this into your planning and you still think you could afford to build a life here, my other worries are - firstly, how will you fund the move and the settling in period (please don't say borrow the money!)? You don't say whether you ever bought that house, but if you didn't, you'll find it difficult to rent without providing proof of income and a deposit upfront. If you did, I hope you've been keeping up to date with the property taxes.

More generally, I think you would also find that a major change of mindset is needed. France doesn't have the UK's casual attitude to debt. Getting into debt is a biggie here and generally it means that either you are 'vulnerable' (ie not capable of managing your own finances) or that you are not an honourable person. Personal responsibility is taken very seriously, you are expected to live within your means - whatever they are - and not paying bills isn't acceptable behaviour. Many people are content to live on what to you would probably seem an impossibly low disposable income after all the bills are paid. Reading your post, I had to think back very hard to remember the UK culture where somehow it has become OK. As Nectarine says, £250 on Christmas presents even if you have the money would be seen as extravagant here; spending money on Christmas presents when that money should have gone towards paying off debts, would be disgraceful.

I'm not being judgemental because I do remember the UK culture, but you have to realise that to a French person who is not used to the easy debt ways, what you are contempating doing would seem shocking. Priorities are different and I think that living with a skeleton like that in your closet could create personal difficulties in France because it would seriously get in the way of forming friendships and relationships. People's attitude towards you would be affected if they knew, it is inevitable, and living with a guilty secret would take the shine off a new life for most people. Personally I think it would send me schizo.

One final random comment - you'd have to stop blaming your problems on 'the way it worked out' and saying things like you'd have been OK if you hadn't had the car to tax and the water bill to pay, because excuses like that don't wash in France. The way things work out is generally the way you plan them. You know months in advance when the car tax is due and when the water bill is due. France expects you to have the money ready and waiting for each bill when it arrives. For instance, there is no PAYE in France; your annual tax bill arrives in September, it can be for many thousands of euro, and you have a few weeks to pay it. You don't get reminders, you get automatic fines for late payment, then when your creditors get tired of waiting you get the huissiers (bailiffs) at your door or, if it's a debt to the government, your bank stops you taking money out of your bank account until you've sorted the bill out and the government has agreed to your banking restrictions being lifted.

Sorry to seem so negative but I think if you do come to France, there is a very real danger (because of the apparent lack of funds to finance the move, because of the difficulties of being self employed in France and because of your track record of budgeting ahead and living within your means) that you would end up heading for the same situation again, but this time in a country that does not tolerate debt like the UK does. The last thing you need is more debt.

If you decide to go ahead, I seem to recall that there is some sort of voluntary insolvency process, a PVC or an IVF or something, or have you done that already?

FWIW, 7 years ago when I moved to France I thought I'd closed my AOL broadband account and was all paid up to date but apparently the final 2 payments had not been made, and about a year later a debt collection agency tracked me down in France and started giving me grief over an outstanding £30. So I wouldn't be too sure that moving across a few miles of water means you can forget about everything you owe.

I'll stop rambling on now because really there is nothing to add to Nectarine's excellent advice. For your own self-respect you should stop ducking and diving and dodging your responsibilities. £7000 is not a massive debt to pay off, get rid of that first, then if you still want to come to France save up and do it properly. Running away from the past is no way to build a future.

mikelincs

IVA is what you mean, but that actually cost money to set up, and then causes problems if you need credit card or credit in the near future. I would talk to the National Debtline again, and/or Citizens advice. Redo your income/expenditure list on their form, don't stint on food etc costs, and clothing, remember you are entitled to buy new clothes for the kids, and have a certain amount for presents etc a month, then offer your creditors a reasonable amount, showing them your income/exp, and ask them to freeze the interest, this should mean you will get the debt down quicker.

Harvester523

I agree with the above. I don't think relocating to France is a good idea - in fact, a recipe for disaster. I've been self-employed in both countries, and it's a lot easier and cheaper in the UK. Cost of living has risen here, so you'll probably find food and clothes more expensive.
I'm sure your prospect of long term happiness would be better by bearing a period of hardship, paying off the debts, and starting with a clean slate. Is there no way of getting a 'normal' loan now you're earning again, to amalgamate and pay off the payday loans to get rid of the never diminishing interest?

Tweedpipe

I could hardly believe some of the statements I was reading in the opening post.

Yes, you've had some bad luck, but you've also been living way beyond your means given the current circumstances.
As ET and Nectarine so rightly state, £250 on Christmas presents when you owe money to others is downright madness.

I took along some bric a brac to a charity organisation (Emaus) a few weeks ago, and glad I did. I was amazed to see a crowd of about 50 people - many with large carrier bags - queuing up before the doors opened. I'd bet that most of these folks don't have the equivalent of £250 to last them the week. Once inside they were getting their kids to try on shoes, coats etc; prices of which ranged from 3 to 10 euros (approx £1.5 to £8). There were also tables full of s/h and near-new boxed toys, and these too were being eagerly snapped up - no doubt for Christmas presents - at prices ranging from 50 centimes to 5 euros each.
I was surprised to see there were also fully functional tv's, coffee-makers, mobile phones etc at approx 15euros.

The message here is, one must learn to live within one's budget. Car's are notoriously expensive to run. If one can't afford the tax for one year - and many cannot - there are alternative options, albeit far less convenient.
I fear that if you came to France with your current mindset, you'd be up the proverbially s**t creek without a paddle within no time.

I sincerely wish you a happier, less stressful future, but you must radically change your spending habits and outlook in general to allow this to happen.

mikelincs

I agree, payday loans are the devils spawn, and should be banned, there was a case here in the UK, a woman borrowed £1700 to pay for Christmas, a month later she was in debt to the tune of £3000, which she couldn't pay, so was trying to get more payday loans to pay off the original ones.
I don't see why Christmas was going to cost £1700, unless she was over spanding on presents, food and everything else. Our Christmas dinner, Turkey and all the trimmings, cost less than £25.
I won't have a car, because, being a pensioner I get free bus travel, so I'm saving well over £1000 a year in tax, insurance, fuel and depreciation.

astitchingtime

Thank you all for your input and while some of it was valid, many of you seem to have missed some vital questions. However just to put a few things straight. I DO speak fluent French, I was married to a Frenchman for 5 years over here, I also speak fluent Italian as I lived in Italy for 3 years in my 20s. I also understand a little chinese due to travelling for work there on a monthly basis for over 2 years in my celibataire period.

My initial employment would not be as self employed technically. That is something I would then meander into should I need it again.

My problem with taxing my car is not about the inability to budget, it is about the fact that the budget for the Debt Management Plan (which someone mentions I should do and which has already been put in place and some creditors have frozen interest and others have added some interest to increase my debt!) allows a certain amount per month towards car maintenance but as explained, as this budget plan has only been in place for a couple of months, I do not have the £160 yet available for that purpose. If it had been 6 months down the line, no problem I would have saved it during that period.

Point 2: Prior to the DMP, I paid everything on time but to do so, I had to manage on around £30-40 a week for food for a family of 4 and my kids were going hungry hence the reason to stop dodging and weaving with money and pretending things were going to change tomorrow and tell those I owed it to I needed to reduce monthly payments!

Point 3: My post did mention at the beginning that I have NEVER had a debt problem until I was seriously ill. I had no credit cards, no loans and nothing owing every month apart from the rent and utilities which was paid hence I have no problem budgeting. Having gone through this now, I do realise that what I was lacking in being self employed was some kind of protection should I become unable to work. I had been building up the self employment side for 3 years after being made redundant without any redundancy pay to tide me over and had not considered such things at that time.

Point 4: If I lived in France and had no debts I would be back in the situation I was in prior to December 2011 and would have no need to get into debt, however, I would time around have put in place a contingency should I find myself in that situation again. It is a case for everyone, we always think, 'that will never happen to me' and at 42 years old fighting fit and working out 5 days a week, I was one of them!

Point 5: Most of your posts seem to concentrate on what's involved in living in France. I am not a ninny and I have done my research, both with ex pat friends who already live over there, my ex and his family and the internet. I have considered private medical insurance my problems do not lie in that area. I know what the cost of living will be and what I need to consider.

Point 6: I do not owe enough to declare bankruptcy or go for an IVA. A DMP is my only option with such a relatively low amount of debt.

Point 7: NOBODY has touched upon my first option which is my preference. My income will be reduced, therefore I contact my creditors again and tell them this while also telling them that I am moving and where I am moving to. I tell them what I can pay and that there is no option for negotiation and continue to pay the new proposed amounts so that at least I am paying. However, my concern is that will they or do they have the legal means to pursue me over there as they do over here to a point that I have debt collectors at my door even though I am paying what I can? If they feel unhappy with the amount being paid can they instigate Court proceedings for a CCJ or will they just keep adding interest and harrassing me and wallop me if and when I return to the UK with a bigger debt? (Which I have no problem with, because I will pay)

My preference, for my own sanity, is not to run away without paying but reduce the stress I am under, pay my debts even if at a lower rate and therefore a longer period. So at least in the meantime, I can provide for my kids and be here long enough to do it!

One of my main concerns at the moment is my health again. Physically, I am told I am as cured as I can be though I have a few ailments left by the chemo treatment, emotionally and mentally, I am getting so anxious and stressed, I am starting to find it difficult to work again and I do not want to be in that situation. Not working at all whether it be here or in France, will only exacerbate the debt problem and that thought makes me anxious. If I become ill again because of this, I cannot work, I cannot pay and life only gets more difficult all round.

So the long and short of it is, I was hoping, as this is an expat forum and there should be people here more familiar with such situations IN FRANCE, that someone may be able to answer the practical concerns not necessarily the moral ones.

Basically, what rights do my creditors have legally to pursue me in France either if I reduce payments which they are not happy with or last resort I do just do a bunk. Because to be honest, if the chances are they are still going to harrass me over there, I won't tell them where I am. At least that way, I will have a chance to build up some savings and pay them back when I CAN afford it. As immoral as it may seem to some.

EuroTrash

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astitchingtime

Tweedpipe. While I realise you are entitled to your opinion I do think you are a little harsh and unrealistic. £250 was the total I spent on Christmas, although one of the gifts was a winter coat my daughter desperately needed as her summer coat was not sufficient in 2degree weather and I had previously been unable to provide one. Some other gifts were also practical, hat and mittens for my 4 year old, school bag and new pencil set. Can you say that is too much to spend? They would have needed these things anyway.

Secondly, walk a mile in my shoes. Single parent, no support, no benefits apparently to support me while being ill with a disease that left untreated, would kill me. We have been shopping at charity shops for the last year or so. I also give a lot to charity myself either directly at the shops or to others via Freecycle. I have sold everything I have of value over the last 2 years to get through this. I need my car just to do the school runs. I have 3 children going to 2 different schools. As it is it takes 2 hours out of my working day to do that, If I had to do it by bus everyday, the cost would be no cheaper but it would pretty much take up most of my day by around 4-5 hours to do it twice by bus. I have tried doing the school run in the morning, leaving the car there and walking the 4 miles home, walking 4 miles back and bringing the kids home in the car to save fuel. Unfortunately, my back and hips (problems caused by chemo) mean I end up suffering for a week in agony and pain walking that distance and again, it takes over an hour to walk it meaning I get no time to work. I already make up the time by working in the evenings. I also work weekends so my kids barely get to see me. My ex (father to my eldest two) is neither use nor ornament and my youngest's father does not even want to see her. I am all they have to depend upon. I don't moan, I get on with it but this situation is the hardest I have ever had to deal with. Relationship break ups, loss of job, deaths nothing compared to this. Because one thing I always had was being healthy enough to work as many hours as it took to make a living one way or another.

My kids are suffering because of MY illness and as a parent, that kills me inside. So I am sorry, but YOU need to take a dose of reality. This is not just about money or spending habits at all. I am not frivolous, I do not drink alcohol or smoke, we hardly buy meat because of the cost, apart from a few fish fingers here and there and the occasional chicken on a sunday we just don't buy cuts of meat. I have cut back just about as much as I could and we still struggle.

Despite my situation, I do give when I can to others because I am more than fully aware of child poverty figures and facts in this country.

I would like to see you teleported into my situation and then write what you have written (totally alone, we moved 8 months before I was diagnosed and I never got a chance to meet new people here, my friends are 250 miles away). I ask nothing of anyone. I get on with life as it is presented to me. Problems are challenges and can be overcome but sometimes, a problem is just that little bit too big for one person.

EuroTrash

I did state that I was tracked down by AOL UK's debt collectors after I moved to France, for a UK debt that I didn't even know I owed, and I never told them where I was - how they found me is a mystery to me. I also know of a reputable UK debt recovery agency that recovers business debts from people living in France. So it seems there is nothing to stop them chasing you in a different country. But a forum of expats are by definition not the best people to give you advice on how UK debt collectors operate, we don't have debts in the UK and we certainly try not to get involved with the huissiers in France. Citizens' Advice would be better genned up, but frankly, without a crystal ball it's impossible to predict what will happen in your case. Some people get away with it, some don't.

I still feel you're not being entirely upfront with us and possibly with yourself. EG you say your debt management plan allows you £36 a month for car tax, you say it was put in place in October, so that being the case you would have set aside £36 in Oct, Nov and Dec, another £36 at the beginning of January and you're not far short, and all within budget. Presumably there were other monthly allowances in the budget to go towards quarterly or annual bills that haven't yet fallen due, car insurance perhaps, so maybe you could have 'borrowed' from those. Yet apparently you're nowhere near affording the car tax. Or am I still missing the point?

You now imply you have a French employment contract, which changes everything. Had we known that we wouldn't have wasted our time giving you warnings about running a business in France, which as you now point out were totally irrelevant.

I can't help thinking that a £10,000 loan from your bank, which now you are earning again they will surely agree to, would pay off all your debts and could be repaid at say £200 a month, leaving you debt free in around 5 years, but clearly you're far more imaginative in your solutions than I would be, so I wish you the best of luck.

Harvester523

It seems the most sensible option to me as well, even if you still go the moving to France route. I can imagine how much the existing interest would mount up if you did nothing about it.
It's really difficult to see how you would manage in France, especially not having access to any figures, for a start you'll have a lot of up front costs - rental deposit, rental insurance, car & car insurance, health insurance for you and three children won't be cheap.
I can't tell you how to disappear because a) I think it would be very difficult and b) I don't agree that it's the best course of action.
What would you do if you became too unwell to work in France?

astitchingtime

Thanks Eurotrash. My DMP was put in place in October when I was in fear of having the electricity cut off due to the payment being a month overdue. (I had had to cancel DDs as I could never guarantee the date on which money would be in the account). So I had to pay nearly £400 in October. My DMP started making the minimum payments in november. So I have had 2 months in which to save the allocated £36 for tax due tomorrow! In addition, my water bill for £143 came in two weeks ago and that needed paying. I have done what I can to reduce food costs to try and compensate. I managed Christmas with the help of £100 cheque sent as a gift from a friend to 'spend on the kids' as they put it.

At present, my income is about 75% what is used to be but even then it is not a set amount every month. Sometimes I don't get as much work and so get less pay. I tried to do an average for the DMP so I still have to juggle stuff. By taking the temp to perm job in France I would know exactly what my income is, albeit slightly lower and certainly would not have the benefits I have here at present (such as Housing Benefit and Child Benefit) but like I say, if it were not for the debts, we would still live comfortably within our means over there.

What I wanted to do ideally is to reduce my offer to the creditors because of the reduction in earnings but hopefully as I am being paid over there I can add a little to allow for contingency that they cannot prove and which means, I pay something at least while giving myself and the kids a bit of a breather until things improve.

My real question was, if I offer them the revised payments adn they dont accept them can they take me to court or whatever if I am not in the UK? I would continue to pay the reduced payments no matter what but that may not stop them from taking it further if they could.

As things stand, I want my life back. That means being healthy enough to earn a living that can get me out of debt and providing for my kids. Although, this may seem like running away and in a way it is, I feel it gives us that opportunity and above all HOPE!

I am a person that will stress and lose sleep over things like running away, because I believe in Karma. I am working as hard as I can, parenting 3 kids alone but struggling with money and my health and if Cancer taught me anything, it is that life is precious and can be taken away from you at the most unexpected of times, don't waste it on insignficance. If it weren't for the kids to be honest, I would just give up work, claim benefits and offer the creditors £1 pw!!

The upside is, if I do return to the UK and they have added interest to my debts and they double, I can opt for bankruptcy or IVA!! It seems such a small amount of money £7k to be causing so much stress.

I did ask my bank and a couple of other lenders for a consolidation loan to clear it and make it easier but because I am self employed and have only just starting earning a reasonably (but undeterminate) amount plus there are 6 outstanding payday loans on my credit record, they said no.