UK Debt Help Whilst Living Abroad
Many people living in the UK suffering with debt problems would jump at the chance to make a fresh start by moving abroad if the opportunity arose.
But simply walking away from the responsibility of your debt is completely ineffective as a debt solution, especially if you want to return home in the future.
Also, in our ever shrinking world, there is every chance your creditors will make the effort to trace you to your new home or, worse, sell your debt to a debt collection agency in your new country of residence.
Receiving professional debt advice should be your top priority to ensure your debts are dealt with formally and in the correct manner, so they are gone for good.
But can an IVA be used by people who are living abroad to clear their debts at home? Absolutely it can.
An IVA for UK debt whilst living abroad.
In cases where bankruptcy is not the preferred option, an IVA can provide the perfect debt solution to those living abroad looking to clear their UK debts.
There are no restrictions on where a person must be living when under the terms of an IVA so long as they are contributing as much as they can afford in repayments.
The only requirement regarding the geographic location of the IVA applicant is that their main centre of interest, i.e. their main residency, has been inside England, Wales or Northern Ireland within the previous 3 years of the application.
This gives ex-patriots, UK citizens living abroad, the opportunity to deal with their UK debt problems without the need to return to the UK.
There are a few practical aspects of being in an IVA whilst living abroad that need to be considered, mainly related to getting the IVA payments into the right place in order for the payment to be made to the IP.
Consideration should be given to :
- Nominating a UK bank account for the IVA payments to be made from.
- Money transfer fees from the country of residence to the UK.
- Exchange rate fees from the currency of the country of residence to UK sterling.
Beyond these practical aspects of an IVA application whilst living abroad the process is pretty standard.
The Insolvency Practice will still prepare the IVA proposal in the same manner and the IVA payments should still be based on affordability.
Affordability will be established in the same manner as normal, by calculating the disposable income of the applicant, although special attention will be given to ensure the applicant's costs of living are realistic for their country of residence.
If there are significant differences in the costs of living between the UK and the applicant's country of residence, then allowance will be made to ensure the applicant can maintain a reasonable and modest lifestyle.
But, as is always the case with an IVA, it will be down to the creditors to decide whether the applicant's proposed financial statement reflects a reasonable and modest life balance and they are free to reject it, or ask for modifications to it, if they feel it doesn't.
The applicant's assets will also be taken into account as part of the IVA proposal and, where necessary, property valuations will be asked for and, where relevant, the IVA equity clause will be included, to help protect the applicant's property under the terms of the IVA.
That said, some assets may be excluded from the IVA on the grounds that they would otherwise be beyond the jurisdiction of the Official Receiver in a bankruptcy and therefore would naturally be out of the creditor's reach.
Applying for an IVA when Living abroad.
Are you living abroad and looking to apply for an IVA in the UK ?
IVAorg specialise in helping people enter IVAs whilst living abroad and will be happy to help you too.