The idea of moving abroad to escape debt seems to be more of a common practice these days. People who have failed businesses or are swamped in debt believe that moving abroad will give them a fresh start and allow them to build a new life.


Reading some of the comments on various UK debt forums opinions on this seem to be divided. Some people think running away from debt is too much of a risk, and creditors will eventually catch up with them whilst others encourage the idea, stating that there is no way you will be found and people should move on and enjoy a new life free from the responsibilities of debt.


In the past this might have been a successful way to start a new life without the worry of unpaid debt. However, creditors and courts alike seem to have caught up with the idea over the last few years and have taken action to make it more difficult for people to escape the responsibility of paying the money they owe.


Creditors taking action


Germany and Canada have reciprocal agreements with the UK when it comes to tracing debtors and debt collection practices. There is not much information available regarding other countries with such agreements although a search on the web may reveal more, it is possible that creditors do not want this information to be readily available.


A reciprocal agreement in the UK means a UK Court can enforce a CCJ (County Court Judgment) using the legal system of the other country. If there is no such agreement in place, a creditor can sell a debt to an agency in the relevant country and debt recovery procedures will commence under the law of that land.


Tracing a debtor


The resources available to creditors for tracing a debtor are vast. Although the resources in some countries may be limited, there are still ways and means of finding people, especially once the creditor has some idea of where the debtor has gone. A creditor may have their own office in that country, or relations with other credit companies in that area.


Creditors employ a variety of tactics to trace debtors. They may go to the last known address, talk to the neighbours, family friends or relatives who could unknowingly tell them of the person's whereabouts. Once they know which country the debtor is in, their job is made much easier.


Using an ATM card in another country shows us how easy it is to get information from a UK account abroad. If we can do this so simply, what other information is able to zip round the world almost instantaneously?


Having resources to trace a debtor or having agreements with other countries, or even the possibility of selling the debt to an agency in the appropriate country does not automatically mean that a creditor will be successful in tracing a debtor. In some cases, people do get away with it. A creditor has a period of 6 years from the last time a person acknowledged a debt to use the legal system to recover monies. However, if a creditor has taken legal action on an account, the debt can be legally recoverable indefinitely. This means that someone could start a new life abroad and work hard for the assets they accumulated, only to find a few years down the line that a creditor has traced them! Everything they have worked for is put at risk and could be taken from them to repay their debt.


What are the Options?


Many people who move abroad to escape their debts may not be aware of the free financial help available. They do not even need to telephone the UK, as there is free advice and help available on the web. Just a quick email can put someone's mind at rest and make them realise they are not alone.


There are companies such as FCL Debt Clinic (www.debtclinic.co.uk) who offer free financial assessment and advice. FCL can also refer clients to a Debt Management Company who charge no fees and can help negotiate affordable monthly repayments on their clients' behalf by setting up repayment plans with their creditors. Anyone with a UK bank account or the use of one for transferring money, with UK debts, can be helped. This way, the ever-present worry of whether a debt is still around is no longer there to haunt you.






Nicola Bullimore has been working with people to resolve personal debt problems for some years. For more advice regarding debt issues, please visit, www.debtquestions.co.uk.
nicky.bullimore@landingnet.co.uk