If you have a lot of debt and are having a hard time keeping up with payments, moving to another country may sound like a great idea. If you’re wondering can debt collectors follow you to another country, the answer is yes and no.
It’s not a simple question, and it all depends on the type of debt you have, your assets, and what stage of debt collection you might currently be in.
Will Your Debt Follow You from Country to Country?
The truth is, your debt doesn’t simply disappear if you move to a new country. You still own the money and you can still be sued if you don’t pay it.
The good news is that once you move, it does make it more difficult for a debt collector to find you and to sue you.
They have to be willing to work with foreign courts and some countries don’t want to deal with debt issues from other countries.
So, your debt doesn’t actually follow you to a new country, but if you go home, it is still there waiting for you.
Does Your Credit Score Follow You to a New Country?
If you have a bad credit score, you will be happy to know that your credit score doesn’t travel with you if you move to a new country.
For example, if you live in the United States and you have build up a bad credit score and then move to let’s say France, once in France they have their own companies they use to determine your credit score.
They don’t use the three typical credit score agencies that banks and lenders do in the United States.
Your credit score would be wiped clean overseas. You would, of course, have to start over from scratch to build a new credit score in your new country.
Even so, that old, nasty credit score you had in the United States is still there waiting for you when and if you return.
It may have even gotten worse if you left debts unpaid after you moved out of the country.
Can Judgements Follow You Overseas?
Judgments are a funny thing. A debt collector has to actually take you to court in the state in which you reside.
So, there are two possible outcomes here:
1.The debt collector begins the judgment process while you still live in the United States.
This means they have already served you with papers requiring you to go to court. Once this happens, even if you move out of the country before your court date, they can still go ahead and go to court without you.
The court will find in their favor and the judgment will stand.
If you have left behind assets such as a bank account or property or even a car, they can go after them and most likely be allowed to take the money from your bank account or sell off your property to cover your debt.
2. You have moved before the judicial process has begun.
If you move out of the country before you are served with papers, then the debt collector would have to find you and serve the papers in a foreign court.
Unless you own huge amounts of money – hundreds of thousands of dollars or millions of dollars, this will most likely not happen.
It costs the debt collector too much money to make it worth it for them to try.
Do Federal Income Taxes Follow You if You Leave the Country?
Unfortunately, there is no getting away from Uncle Sam. If you owe federal income taxes, you will still owe them when you leave the country. Not to mention that interest and penalties will continue to grow.
What’s even worse is that if you own more than $51,000 in back taxes you can be denied a new passport or even have your current passport revoked.
The only way to try and get around the passport issue is to give up your citizenship.
That’s a pretty drastic action, so you need to think very carefully before you go down that road.
If you owe your state back taxes they can also keep you from getting a new driver’s license.
Also, if your creditors decide to write off your debt and you owe more than $600, it will be seen as income and reported to the IRS.
So, even if you don’t own any back taxes you need to keep up with what is happening to your debt and how it is affecting current and future taxes.
What About Student Loans?
Student loans are another type of debt that you can never truly be free from.
It can’t be written off or included in a bankruptcy.
The federal government can levy your social security, take your tax refunds, and even levy your paycheck.
So, if you move overseas and don’t want to pay your student loans, you better not work for a company that is headquartered in the United States or you can still have your paycheck docked.
Another option is to get your student loans paid off quickly. You can read about that here: How to Crush Your Student Loan Debt & Change Your Life
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Can a Collection Agency Stop You From Leaving the Country?
No, a collection agency can’t stop you from leaving the country, but if they get a judgment against you before you leave, they may be able to keep you from taking your assets with you.
What Happens to Your Debt if You Move to Another Country?
Your debt doesn’t go away just because you do. It will stay there waiting for you. Depending on how long you are gone, the statute of limitations of that debt may expire.
This is usually 4 to 6 years, but it can be increased by another 7 to 10 years if your debt collector goes to court before the statute of limitations is over.
Can Debt Collectors Find Me in Another Country?
Can debt collectors follow you to a new country? Yes, they can if they really want to do so. Most of the time, it isn’t worth the effort, so they don’t bother trying in the first place.
To Sum it All Up:
When it comes down to it, you can only truly escape your debt by moving to another country if you plan to never return to your home country.
So, can debt collectors follow you to another country? Yes, they can, but when it comes to credit card debt and other installment type loans, most likely they won’t. However, your taxes and student loans aren’t going anywhere and you could lose your assets to the debt collectors if you can’t take them with you.
When and if you come back, there is a chance you will be in worse shape than when you left.