Debt has numerous legal consequences, both at home and abroad. The first and most important measure for indebtedness is the enormous importance of advice. There are over 1,000 advice centers throughout Germany that help free of charge. Specialists who are familiar with social, banking and legal systems can offer debtors new perspectives for a debt-free future. Even if you want to emigrate with debts, it is advisable to check this with the consultants specifically for a successful realization.
Are you allowed to emigrate with debts?
Yes, you can emigrate with debts, because everyone can freely choose their place of residence. However, emigration is not a suitable way to escape from your debts!
Emigration to an EU country
If the new place of residence is in another country of the European Union, the debt may be collected by local debt collection companies. The so-called “European Enforcement Order”, which all member countries recognize, makes this procedure possible.
Mr. S. has debts in Germany and emigrated to Spain. The creditor in Germany has a final judgment that confirms his claims. The creditor hires a lawyer registered in Spain to find the debtor. The lawyer finds Mr. S. via the tax identification number for foreigners. Mr. S. had requested this number because it is mandatory for every business activity in Spain such as opening an account, buying or renting a property, etc. According to EU regulation (44/2001) the judgment against Mr. S. is now carried out in Spain.
Emigration to distant countries
In their misery, many highly overindebted people even play with the idea of fleeing somewhere far away without specifying a new place of residence abroad when deregistering in Germany, which is otherwise not an obligation. Of course, this makes it difficult for creditors to get their money, but not impossible! Collection agencies have many options, for example access to registration registers, voter registers, etc. to identify people abroad. In addition, the creditor in Germany can obtain a debt in court, which has the consequence that the claim in the Federal Republic of statute of limitations after 30 years.
Can emigration help solve the debt problem?
European countries outside of Germany
Of course, not all emigrants want to run away from their debts at home! Emigration can make sense if it offers the opportunity to contribute to the faster reduction of debts if this is not possible at home. So if you have a lucrative job offer abroad, you can accept this. In any case , the employment contract should be signed before emigration. And the cost of emigration must also be taken into account. Find out in advance in particular about the costs for the move and possibly for the visa.
Classic and very popular emigration countries like Australia, Canada or the USA have very strict visa guidelines. These include, for example
- proof of qualifications such as a degree or a qualification
- Proof of sufficient language skills
- Proof of financial resources.
Exotic countries have less stringent visa barriers, but job prospects for foreigners are very poor, and if you want to build a future with self-employment, you need more financial resources.
It applies to all distant countries that there are no social benefits comparable to Germany. In the case of hardship, not even the subsistence level is guaranteed.
Last but not least, the relocation costs have to be taken into account, which can be significant when emigrating to distant countries.
What happens when you return to Germany?
Some make it abroad and build a new, debt-free existence. Some also fail abroad and would like to return home. The latter have to deal with the consequences and face the situation.
What is the situation when you return?
- The debt mountain has naturally increased during the absence because interest and surcharges have continued to rise.
- An arrest warrant may be pending because the creditors have filed a motion.
- The negative entry at Credit Bureau will make it difficult to find a rental apartment.
What scope for action is there?
1. Seek debt advice!
Specialists can assist you in the difficult situation and have ways to clarify and overcome the situation.
2. Get an overview of the financial situation
The most important thing now is to get a clear overview of the situation. Once a year, every German citizen has the right to a free Credit Bureau self-assessment. All loans, dunning procedures, etc. are stored there. With a little luck, large companies have already written off their debts as a loss after spending several years abroad. All other creditors should try to reach an out-of-court settlement.
3. Last resort private bankruptcy
If the agreement with the creditors is unsuccessful, there still remains the application for private bankruptcy, in which a residual debt repayment is provided after 6 years at the latest, and thus the prospect of a debt-free future perspective.