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What about debt left in the UK when moving to Canada?

What about debt left in the UK when moving to Canada?

Old Aug 24th 2004, 11:22 am
  #1  
emulate
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Exclamation What about debt left in the UK when moving to Canada?

Here is another dilemna - I have a friend who has recently returned from the UK to Canada after residing in the UK for 5 years. He is a Canadian citizen and his wife is a British citizen. It seems that they left the UK without paying around £10,000.00 (that I know of) or so in credit card debt through about 8 different credit card companies. They racked up the debt funding their relocation to Canada but have been unable to repay the outstanding credit card balances as they have not found permanent jobs yet. In other words, they did not have any way of repaying the credit card balances when they "borrowed" the money and speculated that this may change in the near future, but it didn't. They have been recieving default notices and letters from debt collectors but have mainly ignored these for nearly a year.

Are they in any serious trouble? Have they inadvertently committed fraud? Should they contact their creditors with their forwarding address details and attempt to make good on the debts?

Any help with this will be a relief for them I am sure-

D McDonald
 
Old Aug 25th 2004, 5:57 am
  #2  
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Default Re: What about debt left in the UK when moving to Canada?

Originally Posted by emulate
Here is another dilemna - I have a friend who has recently returned from the UK to Canada after residing in the UK for 5 years. He is a Canadian citizen and his wife is a British citizen. It seems that they left the UK without paying around £10,000.00 (that I know of) or so in credit card debt through about 8 different credit card companies. They racked up the debt funding their relocation to Canada but have been unable to repay the outstanding credit card balances as they have not found permanent jobs yet. In other words, they did not have any way of repaying the credit card balances when they "borrowed" the money and speculated that this may change in the near future, but it didn't. They have been recieving default notices and letters from debt collectors but have mainly ignored these for nearly a year.

Are they in any serious trouble? Have they inadvertently committed fraud? Should they contact their creditors with their forwarding address details and attempt to make good on the debts?

Any help with this will be a relief for them I am sure-

D McDonald
Not being able to pay off debt isn’t fraud and it is unfortunately common. The great thing is that credit reporting agencies don’t cross borders. So high debt in a foreign country (even the USA), won’t be reported to the Canadian credit reporting agency. However, sooner or later, your friend’s creditors will clue into the fact that they have moved to Canada and will hire a Canadian collection agency. That agency can report to the Canadian credit agencies.

The amount that they owe isn’t that high. They will easily be able to pay it off when they finally get jobs. However, since they are from the UK, they might realise that because of the exchange rate, they would be better off back home! That said, as long as they don’t borrow in Canada (that would be fraud, because they would be lying about not having any debt), when they get jobs and pay off their British debt, assuming a Canadian collection agency hasn’t gotten involved, they will have a clear credit rating and be able to borrow in Canada (mortgage, car loans, you name it). That is something they clearly will not be able to do in the UK for a while.

Canadian law does not apply outside its borders (the only exception being travelling for sex with children). So if your friends lied on their British credit card applications (if they were unemployed for example), then yes that would be fraud. But only under British law. If they already had the credit cards, then they could use them for whatever they want as they certainly intended to pay them off. (And once again, 10,000 Pounds isn’t that much).

http://www.geocities.com/merdealorsen/immigration.html

Sam
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Old Aug 25th 2004, 10:38 am
  #3  
JAJ
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Default Re: What about debt left in the UK when moving to Canada?

And to add to the other post made, if they really cannot pay the debt they should approach their creditors and seek to make arrangements whereby part of the debt will be formally written off in return for settlement on the rest.

In the UK I'd suggest contacting a Citizens Advice Bureau. I'm not sure what the option's are if they are Canada bassed. But leaving their UK debts to clock up compound interest and penalty charges while unpaid (they won't disappear by magic) is *not* a good idea. It's not particularly moral either.

Jeremy


Originally Posted by emulate
Here is another dilemna - I have a friend who has recently returned from the UK to Canada after residing in the UK for 5 years. He is a Canadian citizen and his wife is a British citizen. It seems that they left the UK without paying around £10,000.00 (that I know of) or so in credit card debt through about 8 different credit card companies. They racked up the debt funding their relocation to Canada but have been unable to repay the outstanding credit card balances as they have not found permanent jobs yet. In other words, they did not have any way of repaying the credit card balances when they "borrowed" the money and speculated that this may change in the near future, but it didn't. They have been recieving default notices and letters from debt collectors but have mainly ignored these for nearly a year.

Are they in any serious trouble? Have they inadvertently committed fraud? Should they contact their creditors with their forwarding address details and attempt to make good on the debts?

Any help with this will be a relief for them I am sure-

D McDonald
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