Made Unemployed - Opportunity In Australia - UK DEBT - SCARED!

[InterminablyTolerant]

Hi There

 

I have followed a number of the threads on this forum, and hope you will forgive me posting this. I am just absolutely terrified about my current situation and the legal implications (if any). I would highly value any help members could provide.

 

My situation:

 

I was on a six figure salary with my previous employer who, a few days ago, informed me that they would be closing with immediate effect. Unfortunately, I have just gone and taken out a couple of loans (about five weeks ago) to help fund a new car and decorate my mum's house for her 80th birthday, and have accrued a fair bit on my credit cards to pay for a silver wedding anniversary cruise for the wife and I. The best part of my salary for the past few years has been spent funding our two children through university overseas.

 

I've been offered a replacement role in Australia, but on a much lower salary (about £40,000 equivalent) and without any accommodation arranged. I already hold a permanent resident visa - as my wife is Australian and we lived out there for a few years. (Returned in 2014, and I have my right to return still active).

 

We will be able to move across to Australia to take up the job, but I know I will be completely unable to properly service my debts (which are roughly £100,000). I am primarily terrified that I will be prosecuted for fraud (although I, in all truth, believed there would be no change to my circumstances when I took out the loans -- as these were only taken out a few weeks ago).

 

I can make full repayments for the next few months before we move; however, I am going to need every penny from my salary to keep us going in Australia for the first little while. I am pensive about offering my debtors a nominal £1 per month payment in good faith until I get established over there.

 

I do not want to run from these debts; however, I also do not want to face prison if the lenders think I committed fraud. We have no mortgage, the house is in my wife's name and I have never contributed towards the house payments: so I think it is safe from repossession, in case things go wrong out in Australia?

 

Basically. Help. Am I going to have an international warrant for my arrest put out because of perceived fraud!? I know this probably sounds ridiculous to some, and I hope you can clarify where I stand.

 

I've got myself in a right bloody mess here.

[unclebulgaria67]

Nothing to do with fraud. Fraud is where false information is given to obtain money by deception. UK Banks don't tend to report people for fraud, where loans are defaulted on shortly after taking them out. It is just a civil matter between you and the Banks.

 

If you are leaving the UK without any UK assets remaining e.g a house, then try to keep payments going before you leave and then once you are in Australia write to every creditor advising them of your circumstances, providing your Aussie address. Once you know your living costs in OZ work out what you can afford to pay UK creditors and make them an offer of affordable repayments.

 

UK Banks don't tend to enforce debts in OZ, even though i believe there are agreements between Commonwealth countries. If you are ever threatened with court enforcement in OZ, you should get advice in the OZ state where you are resident.

 

Best to advise UK creditors of your Aussie address once you are out there to avoid them getting a UK court judgement in your absence, which is then easier to transfer to OZ. Give them your Aussie address and it makes it much more difficult for any enforcement in OZ.

 

Nb. You should get advice about what redundancy payment you might be entitled to.

[InterminablyTolerant]

Thank you very much for the prompt response, Uncle Bulgaria.

 

The one thing that panics me is that on my applications I put Homeowner- No Mortgage. Technically, I am worried this isn't true and the banks could try launching criminal proceedings. Whilst my wife and I consider the home our home together, it has always been in her name. That's the bit that freaked me out. I am probably completely overanalysing, right?

 

I'm trying to sell the car for the best rate I can and hopefully that will allow much of the loan to be repaid for that. However, it is extremely unlikely I can realise much more. Sold my watch this morning and immediately paid towards the credit card what I could - but it barely made a dent.

 

I will certainly write to the creditors as soon as I land. My thoughts would be that it would be a good idea to send these letters by registered international mail and to also email the credit reference agencies to put a note on my file with my Australian address. I anticipate that it's entirely possible the lenders may not accept token payments, so would like to try and avoid the unfortunate issue of friends / family in the UK being hassled by debt collectors or me getting a CCJ. I would be extremely grateful if you - or another forum member - could advise whether this would be a sound course of action and whether any further steps would be a good idea.

 

I will literally sell my assets so that all I'm left with is the shirt on my back, if it helps prove I've not taken out the borrowing callously. My main concern was the house - but having read other sound advice on the forum, I am quietly reassured that it is safe in the wife's name and she can capably demonstrate I have never paid towards the mortgage.

 

Thank you ever so much. And may I also just add my thanks to the community as a whole. I was rather terrified about posting, as I am acutely aware that this does not look like a good situation (it's a really bloody awful one, let's be frank). I just want to put it right as best I can. Not being judged directly and instead offered honest advice and insight is greatly appreciated.

 

Edited to Add: At best, a claim for statutory redundancy would be made, but I've only been employed with the company for 18 months - so I don't think I qualify?

Edited May 10, 2016 by InterminablyTolerant
Details on Redundancy

[unclebulgaria67]

Try not to worry too much. There is a potential issue with the house in your wifes name, even if your credit applications were in your sole name. The house may well be considered a joint asset, with you owning a portion of the equity. You should get legal advice about this to see how this can be protected. If this gets to court they would point to your applications saying you owned a house without a mortgage, so obviously you believed it was joint property.

 

Yes once you are in Australia a letter by recorded delivery to creditors is sensible and to add a note to your credit record makes sense.

 

Re statutory redundancy, this only applies if you have been employed for at least 2 years. But check your employment contract to see what your employers said if anything about entitlement from them, in the event of redundancy.

[InterminablyTolerant]

Hi There

 

A brief update and I would be grateful for further advice.

 

I have now arrived in Australia. Two of my creditors have updated their records (that I can see) confirming my Australian address. I sent all letters by registered international air mail and they have now arrived.

One creditor has emailed me to say that they are unwilling to accept token payments and that - if I do not make my payments in full - they will be sending my file to their fraud team. This is - to say the least - very concerning.

 

In my letters, I made it VERY clear that "it is my full and clear intention to honour my obligations under our agreement, subject to my finances permitting me being able to do so". I asked for an initial three month period wherein they would accept a £1 token payment, until my financial situation - hopefully - normalises.

 

Is this normal practice for "defaulted" cases to be passed to the fraud teams!? Or is it possible I'm just having scare tactics used on me? (Which I wouldn't have expected from a large bank, mainly owned by the taxpayer...)

 

I have absolutely no intention of ignoring my responsibilities for these debts and am tempted to just make the token payments as a demonstration of my intent.

However, if the creditors are adamant that they will not accept them, and given it would cause financial distress to attempt to make full payments at the present time, would it be unreasonable for me to stop making payments on these accounts? (Only on the basis the creditor has said they will not accept token payments)

 

Thanks in advance.

A Very Anxious InterminablyTolerant

[ericsbrother]

and what exactly do you think a fraud team can do when there is no evidence of fraud? You have given a forwarding address and explained yourself so they would be very silly to try nd make a case where one doesnt exist.

Fraud is a criminal matter and would have to be passed over to the City of London Police who would then have to show a prima facie case evidence to the Aussie cops before they can even formally question you. If you are paying a £1 a month then it is clearly an adjusted payment and nothing else. If the loans wre unsecured then that is pretty daft of the bank to lend the money in the first place, the criminal recklessness being on their part with their depositors money.

They are also damned by their own words, ie refusing to accept a token payment.

[InterminablyTolerant]

and what exactly do you think a fraud team can do when there is no evidence of fraud? You have given a forwarding address and explained yourself so they would be very silly to try nd make a case where one doesnt exist.

Fraud is a criminal matter and would have to be passed over to the City of London Police who would then have to show a prima facie case evidence to the Aussie cops before they can even formally question you. If you are paying a £1 a month then it is clearly an adjusted payment and nothing else. If the loans wre unsecured then that is pretty daft of the bank to lend the money in the first place, the criminal recklessness being on their part with their depositors money.

They are also damned by their own words, ie refusing to accept a token payment.

 

Thanks for the response.

 

I agree, it seems utterly surreal. My intention is to make the token payment each month and see what happens.

 

I'm not trying to run or shirk my responsibilities: I just don't have the means to keep up with the payments!

[unclebulgaria67]

Exactly what you should do. Advise creditors of your new position and make whatever payments you can afford. I doubt that they will block any token payments, as that would just be silly.

 

I suspect that it is standard policy for Banks to refer early non payment of finance to the Banks fraud team, where the default is within a number of months. But of course in your case, it is not the case and they will see you have remained in contact with them. You might receive a request for information about your changed circumstance e.g copy of redundancy letters and if this is the case, you should help as much as you can.