To be honest, this is not a ‘debate’ that I am actually comfortable with simply because i dont advocate people running away from their debts. I am playing devils advocate here but I also dont believe it is right proper or indeed moral to not provide an honest answer on forums such as these to what is, on the face of it, an honest question.
The fact is that in some cases people just might decide to run away for a variety of reasons and if that is their choice. As far as I am personally concerned, good luck to them. In this life you choose a road and you take the consequences its as simple as that. The important thing to remember is the debtor chooses a path and is solely responsible for the consequences of their actions.
As for the 6 year rule, it is a fact and it is given to us by the statute of limitations act. Another act of parliament gave us bankruptcy which devolved to provide the IVA. Why is one right and another wrong?
I take the view that if a creditor can not deal with the debt in 6 years then the debtor should not have to pay the debt back. At this moment in time the powers that be are looking to reduce this to 3 years, under heavy criticism from the credit services association to name but one. Some catalogue companies never used to bother to issue a credit agreement even though this was a mandatory requirement governed by the Consumer Credit Act. Those companies that did not comply found that they could not legally enforce the debt, well up until last year when this was changed. Morally the debtor should pay, legally the creditor should have complied with the law but they did not.
Look at the Meadows case, a debt that started at around 10k ended up over 200k because of accelerated payment clauses, default charges and compound interest. Don’t forget The Meadows only got off on a technicality so if we applied the ‘morals’ should the meadows really have agreed to lose their home and pay up the amount owed ?
This all started with a guy who potentially gave a throw away remark that implied he was off to Brazil. Fact - if he did there is not an awful lot that a creditor can do about it. There are an increasing number of countries around the world that the creditor can now transfer the jurisdiction of the debt for enforcement, especially within EU member states. So to be clear, and for the record, I am not advocating that it is OK to run away and hide nor encouraging such but I recognise that for some this will be an option that may be considered.
Now I really don’t want to upset or offend anyone on this forum but as Debbie said we should have the freedom of speech (within certain boundaries anyway).Most ordinary people on here are good minded, well intentioned and offer help and support to those in need with no thought of any commercial advantage for so doing and, usually as a result of some experience with insolvency however, I can not in all conscience see a mad rush to leave the country on the back of that statement but I will also add another element , food for thought.
You have a debtor who has been out of the country for 8 years; let’s say working in Iran/Iraq. This guy has tried to come to arrangements to repay the debts but the creditors won’t play ball and have been adding interest charges etc etc even though a financial statement has been provided. The guy gave up and stopped paying five years and ten months ago. The debts have never gone to court but simply been sold on and on and on a number of times. The debtor has not made any payments or meaningful contact for 5 years and 10 months but has now returned to the UK. In two months the debts will be statute barred and legally unenforceable.
Do you advise the debtor to keep his head down for two months or to get back in touch with his creditors straight away, regardless of the consequences for the debtor? I have come across this scenario many many many times incidentally.
There is only one way of repaying the debt in full if you are so minded and that is to use a repayment plan that offers full contractual repayment. Bankruptcy does not and neither does an IVA in most cases. There is, in my humble and sometimes lonely opinion, nothing wrong in using the laws of the land to the best advantage of yourself if you are suffering genuine distress from debt. There is no honorary kudos in using one method rather than another. I just hope that everyone looks very deeply at all of the available options, investigates actions v consequences as far as one is reasonably able to do and then chooses wisely the best option for them regardless of whatever anyone else thinks of their actions.
My intention is to simply offer practical help and advice for no personal gain rather than an A2Z of doing a quick flit !
