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If I Leave the Country, Will My Personal Debt Follow Me?

Posted on in Arlington Heights Bankruptcy Lawyer
If I Leave the Country, Will My Personal Debt Follow Me?

When you are drowning in a seemingly bottomless well of debt, the thought of leaving the United States to start over somewhere else can be tempting.

If you move abroad in an effort to leave your credit card debt behind, you generally can avoid having to repay it. This is not because you are immune to lawsuits from your creditors while abroad, but because taking legal action to recover the money from you when you are out of the country is often more complicated an expensive for the creditor than it would be to simply not take action. This does not mean there are no potential repercussions for jetsetting your away out of debt – the debt still exists, and it can cause financial difficulties for you in the future. If you truly cannot repay your debts on your own, bankruptcy is a far more effective debt management tool than leaving the country.

If Your Creditor Files a Lawsuit Before You Leave, You Could be Required to Repay the Debt

Not only could the creditor file a lawsuit to collect your debt before you make your big move, it can move forward with the civil action after you have left. This means it can potentially collect money in US-based bank accounts and if you are still working of a company based in the United States, garnish your wages.

Leaving the Country is Not Cheap

Yes, many countries have lower costs of living than the United States, but moving to a new country is not cheap. It involves typing up loose ends, like breaking leases, selling your vehicle, and if your home is in foreclosure, dealing with that. You will also need an appropriate visa for your intended country and length of stay and cash to travel and secure housing in the new country. Unless you work as a freelancer or can transfer your job, you will also be without employment and potentially facing a situation in which you cannot work because you do not have a work visa.

Your Debts will Not Just Go Away

The IRS will still expect tax returns from you once you move abroad. Creditors can also file your owed debt on 1099-c forms, reporting it as income. Although you will have a chance to establish a new credit record in your new country, your American credit score will not be eliminated and if you return to the United States, it will still be the number attached to your name.

Work with an Experienced Itasca Bankruptcy Lawyer

Leaving the country is an extreme solution to a problem that might only need a small remedy, like refinancing your loans or negotiating with your lenders. Even filing for bankruptcy is less of an upheaval than uprooting your life and resettling in a new country. Discuss your options in greater detail with one of the experienced bankruptcy lawyers at Newland & Newland during your initial consultation in our office. We serve clients in the Arlington Heights, Palatine, Rolling Meadows, Libertyville, Mundelein, Buffalo Grove, Schaumburg, Elk Grove, and Itasca areas.

(image courtesy of Himesh Kumar Behera)

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