Has anyone been sued for debt while overseas?
Posted by Careful_Tangelo763@reddit | studentloandefaulters | View on Reddit | 9 comments
What happens if they can't find you to summon you to court because you are overseas? Will there be a debt judgment against you? And what would the implications of that judgment be for foreign employment and visas?
TheRealAMD@reddit
Some countries consider your credit history when applying for residency or even some visas (not your FICO score or minor things like late payments but major issues - think foreclosures, repos, liens, judgements, etc...) .
The UK comes to mind, I remember around 10-12 years ago my father was almost turned down for a work permit for a temporary assignment in London because of a charged off credit card - I can't recall if he had to pay it off or have a guarantor he wouldn't normally have needed, but I know he almost didn't get the visa.
Careful_Tangelo763@reddit (OP)
Was the it in the UK or overseas?
ForestDweller82@reddit
For private loans they can't serve you, so they can't sue you. It takes 1-2 years for the loans to charge off as unpaid, and only after the charge off completes, they stay on your credit report for another 7 years. This is often with multiple entries on the same report for the same loans, as they are passed down through various collection agencies, and each agency gets it's own entry.
The statute of limitations for them to sue is normally less than that time, depending on your state. After 7 years, they completely disappear from your credit report, your credit returns to normal, the statute of limitations has normally passed by then, and they can no longer sue.
They can still call, write, and harass you though, and you technically still owe it, they just don't have a way to make you pay and it no longer affects your credit. If you ever acknowledge the loan, the statute of limitations re-sets and it could re-appear on your credit report, so acknowledging the existance of the loan in any way, ever, is a bad idea if you're taking this route.
For federal loans and federally backed 'private' loans, the government doesn't need a court judgement. They will just garnish any USA paychecks, tax returns, or 10% of your social security checks if you ever return, and there is no statute of limitations. They can also continue to keep them on your credit report indefinitely, however they typically do not do that and they generally do fall off after 7 years. Federal loans will qualify for forgiveness programs though, while private never will.
You can safely login to the department of ED website to check if any of your loans were federally backed. This can't harm you since the dept of ED is the government. They don't need to sue you and they've already got access to your paychecks. Everything on that site qualifies for various programs and also for garnishment. It can be confusing because private servicers also deal with federally backed loans, so there may be some difficulty cross referencing which ED loan corresponds to which 'private' loan on your credit report, but anything on the ED site will have a corresponding private entry on your report (sometimes multiple entries).
Print out your credit report annually and keep it, because you can't get old ones later, they only go back like 5-10 years, and if a private loan falls off you won't be able to get a copy in the future without acknowledging it.
I went down this route moving to Europe and it worked. 14 years later it turns out my school was a scam school and it all got cancelled with borrower defense (i never once made a single repayment), but it would have been a tough first 10 years if I stayed. I noticed the balances on my credit report would often halve because the interest would reset with each new collection agency. That would be the best time to negotiate if you stay.
Careful_Tangelo763@reddit (OP)
I really appreciate it. I have not yet defaulted. Sounds like I’m off the hook; hopefully, no one will look at my old credit score. I never wanted to be in this situation, but I just can’t find a job and have to go where I can get employed. I’m scared that if employers do a background check, they will know that I have defaulted overseas, but it sounds like that won’t be an issue. If that is the case, then I’ll be in a worse situation… but this might not matter, it’s just a scary situation to be in.
Areaman6@reddit
you can tell them to pound sand. They can't collect what they can't touch and have no jurisdiction where you are. When you want to come back, they will be here waiting for you however.
LisaInSF@reddit
If you can’t be “served” with a summons, per the laws of the state where the case is filed, then the case cannot go forward. The creditor would have to serve you in the foreign country, which is difficult but not impossible.
a_library_socialist@reddit
If you don't make money in the US, you can basically tell them to eat shit.
If you do, then they can possibly garnish that income.
GrandTheftNatto@reddit
Your fine. I lived in Japan and they couldn’t do a thing while I was there. As long as you don’t have co-signers and don’t mind your credit being wrecked you’re fine. However, one word of caution make sure you’re gonna stay long term cuz coming back home to a wrecked credit score could make things hard.
SettleBankDebt@reddit
It depends on your ties to the US, normally if there is no service, there is no process, however as a debt negotiator I have seen law firms use alternative methods of service such as notice of publication to be able to obtain a judgement. In regards to foreign employment and visas that is an open question.