Posted by
wilbur134
14 yrs ago
Hi All,
Im looking for some advice. Ive recently been made redundant in HK after working for 3 years here for the same company.
It looks like I will have to go back to the UK as after trying for the last two months, I cannot get a job and am running out of cash fast. The main problem is my flat is costing me 32K a month and I cannot get out of the lease as i still have 7 months left to go before i/landlord can exit the lease. I have some credit card debt(37K) and about 150K of Personal loan debt with HSBC. Ive no way of paying this off....Ive never been late with as much as a phone bill in my life but unless i get a job in the next two weeks, ill be forced to up sticks and leave it all behind.
Ive tried to go in and talk to a manager in HSBC and sort something out like you would do in the UK if you were finding yourself a bit behind but they dont get it...they will not agree to give me a break on repayments for a few months until i get back on my feet.
What are the consequences of leaving debt here? Ive heard of people not paying their tax and then getting arrested at HK airport when they come back here a few years later. Would the same apply to someone who has defaulted on a loan? My tax affairs are all sorted thankfully.
Would really appreciate some advice if anyone is expert in these matters.
Regards
Will
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me thinks you should talk to your landlord first to get a break...they are certainly more accomodating than the banks
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thanks Cookie....Ive tried that put she has said that the apt would now rent at 20% more than i pay so she isnt keen on giving me a reduced rate. She will likely keep my deposit as i will probably default on my contract with her.
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thanks beancurd. As i stated above, I have never as much as missed a phone bill so yes would conscience would be bothered by leaving debt. Long term i would like to return to HK to work so hopefully something will work out for me
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Your debts will follow you for life. Your info will be on credit agencies.
Defaulting on a hsbc loan is not a good idea since they are one of the biggest banks in the world, and in the future when you plan to buy property, the banks conduct a credit check on you and your default will show up.
The fact that you pay $32K to a landlord and you have no savings means you are living beyond your means.
Can you sell any assets ? stocks ? jewelry ? cars? expensive stuff ? to pay of the loans.
If your landlord has your two month deposit, I guess you can "delay rent" for two months.At least you have a roof over your head
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I was in a bad skiing accident in Japan last year and was in a private hospital for 3 weeks which wiped out my savings plus got me into this loan....my insurance didnt cover me skiing so thats why i was in debt. before that...i used to save 20K a month so wasnt entirely living beyond my means...if i hadnt been let go, i would be debt free by christmas...ive explained this to the mgr at my local hsbc but he is a complete fool and wont allow me a payment break until i get a new job. in one way with his attitude, id just like to tell him to stick his loan. i intend to pay the loan back when i return to the uk and get a job. im not in any way, shape or form a person who would default on a loan as this is fraud in my eyes.
either way, im going to have to default on this loan for a few months, then hopefully ill have a job and can work something out with hsbc to pay back a certain amount per month..my only worry is that if uk bank do a credit check on me, this default will show up....does their credit check involve a global search?
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Any chance you can borrow money from friends? A few thousand each to help you out? You know, all the drinking buddies and let's hang out crowd. Sorry about your accident.
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I would never ask my friends for help like that..I would prefer to default to be honest. Better defaulting to a bank than your friends down the line....
Hopefully it wont affect my credit rating in the UK in the medium term, before i arrange an agreement with HSBC to pay it back over time.
I just hope im never stopped by police when entering hk in the future
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With HSBC you need to be very careful, they are too big and chances are it will show up in the UK. What you need to do is skip the branch manager and go higher up the chain, the branch managers here don't have a lot of power to make those kind of decisions. You need to check with a loan officer head-in-charge (try the main HSBC location in central) and agree to sign another contract to defer payments, but expect to pay a stiff penalty for the consideration. You need to lay it out in terms of "If THE BANK (do not use the word 'you') can not help me then THE BANK will loose a lot/all of the money I owe then, including the interest because there is no way I can pay them right now. You need to give them a specific date for when you make a new payment (in under 6 months, 3 would be better and you need to be ready to borrow from friends/family if you might default on that or you will have no credit rating.) Also ask them what will happen if you make the payments late - what kind a penalty are you going to incur financially? Interest rate increase? Minimum payment increase? If they still will not work with you make sure you can afford to the penalties. Late payments affect your credit rating but once the loan is paid off it doesn't have as large an impact and over a couple of years can earn forgiveness in the credit world. Unfortunately being western works against you because westerners are viewed as being rich. Alternatively, you can leave HK and as soon as (within a day or two to show how serious you are ) you get to the UK take all your papers, including evidence of medical and job dismissal to the HSBC branch in the UK and get them to TRANSFER the loan to the UK. They don't like to do it, but if you are living far away they should. Again talk to someone high on the food chain. If they will not transfer the loan they should be more understanding with the recession and able to help out. Good Luck!
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thanks elionkg
i have asked someone in retail banking and they have said that due to the relatively low amount of the loan and the fact that i will leave hk, that it is extremely unlikely HSBC would follow up on this debt with a debt collector in the UK. She said their procedure will be to send a ton of letters to my home in HK and try call my phone in HK which will be dead. She said my credit rating in hk will be crap from now on but in her opinion, this will not transfer overseas.
I am due to fly next weekend back to UK, I have informed the bank now that I will try to repay the loan when i get a new job but at the moment i cannot repay the next installment.
id really like to know where i stand legally and what will actually happen...not people opinions! alas, i cannot afford a lawyer!
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sorry to hear your plight.
there's no other option but to talk to your landlord. i'm sure with the right documents and evidences showing you won't be really be able to afford to pay anymore, pretty much he will just let you go but be prepared to lose all your rent advances. the earlier you can move out, the better. try asking your friends for temporary shelter. during this time, you really have to swallow your pride.
banks have a responsibility to get back their money regardless of any situation as long as it is under legal procedures. obviously, calling them fool is not appropriate since they have to answer to their bosses too. i'm pretty sure that you will be doing the same thing if you are on their shoes.
unfortunately, be prepared for the consequences that can happen, be it your credit rating or your status here in hong kong.
you might not ask friends for help but in this kind of case, and if you have the chance to borrow, just simply ask. swallowing your pride in this case i think is worth taking.
or you can just leave and don't come back here but if you are really serious in paying back the bank, i'm sure you can do that anytime in the future, but ofcourse, you also need to pay the interest that will accumulate. pretty sure, they (banks) will be happy and problem will be solved but just don't expect for a good credit rating anymore.
hope my advice somehow helps.
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cbc
14 yrs ago
Hi my advise is run out your deposit on your flat, then move to some where is really cheap, mui wo lantau island, lamma. $4,000 per month.
Then start looking for a job, after taking time to relax, calm down and start thinking properly with a clear head.
Good Luck x
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If you are financially unable to pay your rent, the landlord cannot do anything about it. The worst he can do is evict you. He said it himself, he can have the premises for a much higher rent. So tell him to let you off the tenancy agreement instead of just lowering the rent -- then get a cheaper flat. You mentioned you have insurance? why don't you loan from your policy? Insurance companies will do it for you and they will not harass you into paying it. They will just deduct if from the cash value of your insurance policy when you decide to surrender it. Of course together with the 8 - 9% interest per annum.
This is exactly what I did in the last months just to pay off rent and stuff.
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This and something similar happened to two friends of mine (I mix with some great people...)
The first person was in exactly the same position as you: had a loan, lost his job, couldn't afford the loan and went back to the UK. But he never intended to pay the loan back (different from you, I know).
In the second case, a friend skipped town without settling her tax bill and went back home to Australia.
Both of them had to return to HK for their new jobs. Both came for a few days and, when leaving, they were arrested at Immgration for unpaid debts. Both ended up calling around their friends frantically in order to settle the outstanding amounts and were only allowed to leave HK once everything had been paid in full (their passports were confiscated).
So, whilst I hear you're saying you will pay everything back, just be aware that if you do return to HK without having cleared the debt, there may be consequences far worse than having a crap credit rating (assuming you, like me, think getting nicked is worse than not being able to get on the property ladder).
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re lil mo
Thanks for your response!!! Now im a bit more worried. However, it is my undertanding that the police to not get involved in civil matters like bank loans...in my understanding, its not an offence to not be able to pay back a loan so im sure you have maybe heard that story worng.
I agree, It is an offence not to pay your tax and you will be stopped on entering HK for that.
Im booked to fly at the end of the month back to UK and ive some interviews lined up there in August. Perhaps i should declare myself bankrupt in hk and draw a line in teh sand.
I would imagine at some stage, ill be back in HK given the nature of the work i do but im confiident the police/immigration would have no convern with me as ive paid up my tax bill in full.
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Hey Wilbur,
I'm not trying to scare the crap out of you, just let you know what happened to two friends of mine. Re the one who didn't pay back the loan, I can assure you he was arrested as I was one of the people who helped pay off his debt. As to why that happened, I can't say as I'm no legal expert but all I can think off is the debt was passed on to a debt collection agency who took it all the way so that he was a "wanted" man.
Again, I don't know how the system works but I can assure you that it did happen. My guess is that if you default but start making repayments soon, your credit rating in HK will get trashed but the bank won't pass the debt on to an agency.
One thing about what people have said about your debt following you and affecting your credit rating, I had an issue with the Student Loans Company in the UK. When I moved here in 1999, I updated them with my new address. When I moved to a new place six years ago, I gave them my new address twice (filled in the forms, mailed and faxed them) but I have not heard a thing from them since. I assume that means I now have a bad debt in the UK but I did send the forms (on two occassions) by registered mail (still have the receipts) so if I ever getted pulled up, I can explain. However, it's never had any affect on my credit rating here in HK.
Re the tax, they will let you enter HK but won't let you leave if it's unpaid which is not the case with you but be sure, if you are leaving soon, that you go to the Tax Dept and make sure you have settled your bill for tax this financial year. Actually, you might be lucky and get something back because our tax bills always include the provisional amount for the next tax year (2010/2011). So you'd have paid provisional tax for this financial year but since you recently lost your job (sorry to hear that BTW) the provisional amount you have paid may be too much meaning they may be able to refund you.
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lil mo makes a very good point.
You will have paid this years provisional tax (Apr 10 to Mar 11) already. You should approach the Inland Revenue now, not as you leave, to reclaim your overpaid tax.
That will then give you money to a) support yourself and b) pay rent and c) make loan repayments.
A friend of mine lost his job a year back and he got the money back pretty much immediately, when it became obvious he was not taking another job here.
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sprurito/lil mo
when i said that ive settled up with the inland revenue i meant that i had received back any excess tax already. Thats what has helped kept me going since ive been let go.
its my plan to come back to HK if a suitable interview/job arises over the coming months so hopefully i wont be detained at the airport because il have no money or means to repay the full loan and it is the kind of thing that would put future employers off.
well one way or the other im off next week so hopefully ill get a job and be able to start repaying the loan again.
Im still unsure about how a civil matter like defaulting on a loan can end up in the hands of the police/justice....it does not happen in the UK, im certsain of that and HK law is based on UK law so sounds a bit weird.
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First of all, you can easily get out of your rental contract - though you would lose your deposit. You simply move somewhere else. The landlord could technically sue you but the amount he/she can claim is mitigated if she rents it out to someone else - which is easy under present market conditions. teh landlord would have to get a lawayer and it's just not worth it. beleive me, I'm a landlord and I went down this route once - never again. Secondly; refinane everything including the credit card, into one extremely long loan if possible. Thatway, you won't miss any payments. This will have to be done at HSBC HQ.
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Any update how that went eventually?
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It is sad to hear your case.
There are times when going gets tough like your case then you have some options where you can take special steps temporarily.
Its not that there are no jobs in Hong Kong.
Since in your case both the glass is also broken and the milk is also spilt/spilled.
If you are single then the below suggestion might be possible:-
There are many jobs in the construction and the pay is around 20k for starters thats better than no job and secondly with the low pay you need to decrease your house rent thentry finding someone else to share your flat with you until your contract period is complete. .
If you can then try working 2 jobs....Day time construction and for night time try finding a security job where you may also get around 15k+ per month.
So possible 20k+15K & flat share decrease your rent. This is just my suggestion for temporary basis and I know there are people doing this too hence my suggestion.
Where can you get access to information for both construction & security :-
If you can get some connection with Nepalese who can help you out since they are also dominating in these 2 fields.
I am very sorry in your case but this is not the end.
Cheers
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Hi all,
This looks like a really old post but I'm in a similar situation atm.
I have credit card debts and personal loan with Hang Seng and I intend to pay them off. But I'm jobless and wanna go back to uk. I have some money in my MPF that'll help me pay the loan for few months and I wanna go work in UK and send my monthly instalment to the bank.
So what I wanna know is, will I be able to get my MPF out declaring permanent leave, with all the outstanding debts in a bank?
Thank you
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Suarez1988,
If you are leaving HK "permanently", yes you can get your MPF back.
http://www.mpfa.org.hk/eng/mpf_system/system_features/withdrawal_accrued_benefits/index.jsp
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