bankruptcy student loans canada
If we file for bankruptcy in the United States, how will it affect our credit if we move to another country?
My fiance and I are currently residing in the United States and are considering filing for bankruptcy. She is pretty deep in student loans, I’m still paying off my car, and our combined credit card debt is over well $30K. She’s been seeking work for over a month now and I was laid off last week. Our situation seems pretty bleak, but I think bankruptcy might be a chance for us to start fresh and do things right. However, I am concerned because it seems like living in the US would be extremely diffucult with a bankruptcy looming over our credit report for the next 7 years. What would happen if we filed for bankruptcy, but then moved to Canada or New Zealand for a while? Will our bankruptcy follow us to a foreign country? Will our creditors chase us down? Will we be allowed to come back to the US after 9 or 10 years?
You need to understand that federal student loans are NOT discharged in bankruptcy and they have NO statute of limitations either! If the education lender files default with the Dept of Education, the DOE can come after you 5 years from now, 10 years, 25 years, there’s no end. Will a BK follow you to another country? Probably not. However, a stay of any significant time will involve that country’s immigration dept and they are free to look at your finances. They may have no jurisdiction to pull your credit report, but they will certainly want to see that you can support yourselves, just as our immigration process demands.
Bankruptcy may be a very good option, but running away is not the answer to your problem. I’m sorry for what’s happened and I can’t imagine how tough it is to both be out of work. You need to call your creditors and tell them what’s happening. If the words “financial hardship” ever applied, they certainly apply now!
By the way, on those student loans…while they are the worst if you refuse to pay (no forgiveness), they are one of the most lenient if you’re having hard times. You can request a forbearance and the payments stop. The interest continues building, but at least you can get out from under the payments until you’re able to resume paying.
Do what’s right. Get a forbearance on the student loans, file BK on the rest if you have to (and are qualified to) and try to make ends meet until you find work. Just don’t run away. The US Gov’t doesn’t forget.
