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I'm a student halfway through my undergrad degree, looking at the prospect of huge debts, and by the time I eventually pay them, house prices back up to the silly levels of last summer. I speak a couple of European languages at different levels of (in)competence, have lived in France for 3 years after leaving school, and I'm on course to get a first. I already quite fancy moving abroad for good.
My question is, would it be a serious plan to get as many credit cards as I can in the year following graduation, pay off my student loan with them, arrange a job on the Continent, then declare bankruptcy and sail off scot-free into the sunset?
As far as I can see, my British credit rating wouldn't follow me overseas, and there's nothing to stop a bankrupt benefiting from EU freedom of movement. I would need to have a job lined up, tell the court where I'm going and keep up with any payments it orders, but I could do all that without problems. And 6 years after being discharged, I could come home if I wanted to and have no credit history.
The questions I already thought of are:
1) Is the court likely to ban me from leaving Blighty?
2) Would paying off my student loan quickly with dodgy credit cards, just before I go bust, be seen as dishonest and lead to a longer/more severe bankruptcy?
3) Would the court allow me to save anything while bankrupt towards the cost of moving to a new country? I think I'd need at least £500 cash in hand to get somewhere to live & deal with local bills & paperwork.
4) If my European employer gave me a salary advance to pay for moving costs, would the court seize it?
5) Are foreign governments or employers able to check, later on, if I had ever been declared bankrupt in the past? I can see it might be hard to move anywhere outside Europe if I have to own up.
6) Can I go bust in England after moving abroad, without involving the courts or bureaucracy in my new home?
(edit: These really should be 1 and 2. Shows how smart I am)
7) Is preplanning a bankruptcy actually illegal?
8 ) Last but not least, there's a chance I might be married by the time I graduate. Assuming Mrs DM agrees to follow me overseas, would the fact of being married to a bankrupt cause her any problems? We wouldn't have any joint property or debts.
Feel free to have a go at me for being sneaky and unpatriotic in even thinking of this... but I hope someone will answer the questions as well ;-)
Incurring large debts and then going bankrupt is dishonest - even of the borrowings were used to pay off another debt.
I think you will find that such matters are not wholly approved on CAG, which might explain the lack of response to your post.
1. No
2. Most likely
3. No (actually it's the Official Receiver)
4. If they knew about it
5. Yes - anyone can
6. No - you need to have a UK address
7. No
8. Legally it shouldn't
I really do appreciate all those 'thank you' emails - I'm glad I've been able to help. Apologies if I haven't acknowledged all of them.
You can also ding my gong if you prefer.
I do not personally feel it is right to take out credit, and move abroad. If you take credit out, it should be because you feel able to repay it, and if you struggle to repay, there are lots of people who try their very best to pay at least something.
One thing to also consider is that although your credit history may right itself after 6 years you may find that mortgage applications will ask if you have ever been insolvent. This could seriously affect the lending decision.
Bankruptcy and emigrating to Europe
after being discharged, I could come home if I wanted to and have no credit history.
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