Leaving the UAE with car and property loans outstanding
Perhaps the government will kindly cover all ex pat financial obligations as a gesture of goodwill and absolve all responsibility for debt repayment, in line with the habits of the local population .
Join Date: Feb 2005
Location: on earth
Posts: 274
Likes: 0
Received 0 Likes
on
0 Posts
Right or wrong and like it or not, you are playing on their playing field when down there, anyone going to that part of the world should be aware of that prior to packing the bags.
As WK said, too many come down and make way more money than they have ever done and go on a spending spree like there is no (gloomy) tomorrow and if that spending spree is based on loan and credit cards, well, then you are no longer a free man. It’s a gamble they are willing to make, but it can come at a big price. Did anyone predict being sent packing because of a virus? No. But, there are so many other things in that part of the world which can warrant a quick escape where being in debt is the last thing you want to be. Plan accordingly.
Even here in Europe I play by that rule. I have one rental unit which I can pay off tomorrow if I wanted to, everything else is in my name including three cars. After now having recently entered year two of unemployment that is something which comforts me when I go to bed at night. And no, I was not born with a silver spoon in my mouth, I have worked hard and not overspent despite having been on a good salary for the past five years (before my unemployment).
Disclaimer; I do not work for EK but I have lived in Dubai previously and my last job kept me in the UAE for weeks at a time, so I am well familiar with how things work in that region.
As WK said, too many come down and make way more money than they have ever done and go on a spending spree like there is no (gloomy) tomorrow and if that spending spree is based on loan and credit cards, well, then you are no longer a free man. It’s a gamble they are willing to make, but it can come at a big price. Did anyone predict being sent packing because of a virus? No. But, there are so many other things in that part of the world which can warrant a quick escape where being in debt is the last thing you want to be. Plan accordingly.
Even here in Europe I play by that rule. I have one rental unit which I can pay off tomorrow if I wanted to, everything else is in my name including three cars. After now having recently entered year two of unemployment that is something which comforts me when I go to bed at night. And no, I was not born with a silver spoon in my mouth, I have worked hard and not overspent despite having been on a good salary for the past five years (before my unemployment).
Disclaimer; I do not work for EK but I have lived in Dubai previously and my last job kept me in the UAE for weeks at a time, so I am well familiar with how things work in that region.
Why are you still unemployed after one year ?
Should you find the question too intrusive there is no need to answer.
I don’t think the victims of the redundancies need a lecture on frugality they need advice on what they should do now .
Should you find the question too intrusive there is no need to answer.
I don’t think the victims of the redundancies need a lecture on frugality they need advice on what they should do now .
Join Date: Jun 2011
Location: hang on let me check
Posts: 654
Likes: 0
Received 0 Likes
on
0 Posts
White Knight
I agree people should try and sort out their debts in an amicable way with the banks.
People ‘shouldn’t’ over extend themselves of course, but who takes a mortgage of however much if the have the money to pay for the property? If that were the case then no one under the age of 50 would buy a house and then what a fix the banking industry would be in.
The problem comes when people through little fault of their own have a large negative equity debt in their property and find themselves in UAE and stuck....then what do they do ?
I agree people should try and sort out their debts in an amicable way with the banks.
People ‘shouldn’t’ over extend themselves of course, but who takes a mortgage of however much if the have the money to pay for the property? If that were the case then no one under the age of 50 would buy a house and then what a fix the banking industry would be in.
The problem comes when people through little fault of their own have a large negative equity debt in their property and find themselves in UAE and stuck....then what do they do ?
Join Date: Feb 2005
Location: on earth
Posts: 274
Likes: 0
Received 0 Likes
on
0 Posts
As icing on the cake I even managed to catch the virus on my way home from indoc, two days of feeling a bit uneasy and then loss of sense of taste and smell for about a month.
It may sound like I am lecturing those down, and I do feel for those who have shared the bad end of the stick together with myself and everyone else losing their jobs in this mess, but I cannot feel sorry for those who have not prepared themselves during the good years for an economic downturn we all knew was lurking behind the corner, no matter what the reason for that downturn was. Anyone in this business should be aware of the boom and bust cycles of aviation, it’s not exactly a secret.
Many people learned a lesson during the GFC, but I guess the younger, mostly inexperienced crowd which EK has attracted over the last few years were in flight school at the time dreaming of the Porsche they would be able to buy after a few years as a pilot. We live in a world where being fiscally responsible has not been awarded, be it for individuals, companies or countries. Now many of them are paying the price for it though.
You want my advice to those affected? It probably won’t help them this very minute, but once they get back on their feet they should look at how to prepare themselves to not end up in a bind like that next time around, if they are young enough they will experience a downturn in the industry again. If they aren’t young enough to be around for that, well, then they should have known this already and probably can’t be helped, as harsh as that may sound. It doesn’t necessarily take a virus, it can be an accident or illness leading to a lost medical change in family situation, violation etc etc. As an aviator we should be used to be prepared for a worst case scenario, whether it’s in the air or life in general.
Join Date: Jul 2020
Location: Changes
Posts: 217
Likes: 0
Received 0 Likes
on
0 Posts
Given the fact that you are (were) provided with nice or sometimes very nice accommodation all payed for including utilities, could you please explain to me what would make anyone opt out of this and take on a mortgage in one of the most unstable regions of the world?
I dont think you can criticise someone for wanting their own home. People all around the world want that, it is not ‘keeping up with the Jones’ FATBUS. I didn’t have debts for fancy cars or have any loans or credit card debts.
I would caution those thinking of doing a runner. It is possible that in the future your parents siblings or even your children can be detained for your so called crimes , until you show up to face the music. This is also true in all the Arab countries not just the UAE.
Join Date: Feb 2005
Location: on earth
Posts: 274
Likes: 0
Received 0 Likes
on
0 Posts
I just want to clarify something from my post above. It’s not that I don’t feel sorry for those who have lost their jobs, I do as I just like during the GFC I now know what it feels like being out in the street. I just can’t feel sorry for those who, while making good money for several years, have not put away enough for a rainy day (or year/s). In today’s industry of aviation (he!!, most industries in today’s age fixated world) one should have a goal to have put away enough money to (at least semi) retire by the time you hit 60, or even before, if you have had the means to do so. You never know what curveball life will throw at you.
Fancy cars (although I like nice cars), boats etc will not be of much help if you unexpectedly find yourself needing cash just to “live” late in your career.
Fancy cars (although I like nice cars), boats etc will not be of much help if you unexpectedly find yourself needing cash just to “live” late in your career.
Something of a catch 22 situation really.
Losing ones job means losing not only an income stream but also the resident visa.
Unless new employment is found, difficult at the moment, one has to leave the country.
What can be done ? I think the best course of action is to try to negotiate reduced loan payments from whatever country you are returning to. The banks will employ local collection agencies who will no doubt employ some scare tactics , you will be protected by government legislation in your own country as long as an effort, no matter how small , is made to repay what is owed.
As far as mortgages are concerned , positive equity is good, negative of course is the opposite. Losing the property to bank repossession is a possibility if it cannot be rented to cover costs. I’m sorry to say, but this happens worldwide.
As for parents , siblings etc being held hostage because of a relative,s ongoing debts, that is most unlikely in my opinion .
Losing ones job means losing not only an income stream but also the resident visa.
Unless new employment is found, difficult at the moment, one has to leave the country.
What can be done ? I think the best course of action is to try to negotiate reduced loan payments from whatever country you are returning to. The banks will employ local collection agencies who will no doubt employ some scare tactics , you will be protected by government legislation in your own country as long as an effort, no matter how small , is made to repay what is owed.
As far as mortgages are concerned , positive equity is good, negative of course is the opposite. Losing the property to bank repossession is a possibility if it cannot be rented to cover costs. I’m sorry to say, but this happens worldwide.
As for parents , siblings etc being held hostage because of a relative,s ongoing debts, that is most unlikely in my opinion .
Join Date: Jul 2020
Location: Changes
Posts: 217
Likes: 0
Received 0 Likes
on
0 Posts
FlyTCI
So how does that fit in with people not at the age of 60?
I had plans that would have put me in the position to do exactly as you say. It then puts you in a position where you eat your future to fund the present. That said, fortunately I didn’t load myself up with credit cards car loans and the like.
Someone with a mortgage has hefty debt and with the current climate in the UAE property is rapidly falling. Someone in financial straights at the moment hasn’t necessarily been financially stupid, they may have done the right things but been in the wrong place at the wrong time.
So how does that fit in with people not at the age of 60?
I had plans that would have put me in the position to do exactly as you say. It then puts you in a position where you eat your future to fund the present. That said, fortunately I didn’t load myself up with credit cards car loans and the like.
Someone with a mortgage has hefty debt and with the current climate in the UAE property is rapidly falling. Someone in financial straights at the moment hasn’t necessarily been financially stupid, they may have done the right things but been in the wrong place at the wrong time.
Join Date: Feb 2005
Location: on earth
Posts: 274
Likes: 0
Received 0 Likes
on
0 Posts
I think we are actually saying the same thing, just in different ways. As long as you have been smart with your money no one can blame you for not reaching your financial goals do to circumstances which are out of your control. My plane being sold was such a thing, the virus another. Both have put me behind my schedule of making my goal, but those are things I cannot control. I can only hope that I in not too long am able to get back on the good bandwagon again and continue towards my goal. Just like I hope you do too, and many others out there who are currently suffering.
The difference is between those who don’t put away the hay while the crop is good and then complain when the drought comes around, versus those who have done the opposite. From what I can read you belong to the latter group.
A former colleague of mine made really good money in the 90s but spent most of it on things he really did not need. Then his company folded and his upper 10% seniority number didn’t mean squat. For several years he was working really low paying jobs (think $60k/year as a 737 captain) until he finally landed at my old employer and he once again was making good money, until the plane sold two years before him reaching 65. Had he managed his financials more responsibly back while he was raking it in he probably would not have to sweat during the last year leading to his retirement.
My hope with these past postings is that those much younger than me listen to what is being said and learn from those of us who have been around for a few economic cycles, both when it comes to success stories and mistakes. Many of today’s younger generation who entered aviation post GFC have seen nothing but upward pressure on salaries, more jobs available than in a long time, stock market just going up and up along with property prices. It is very easy to get naive and complacent in an environment like that.
The difference is between those who don’t put away the hay while the crop is good and then complain when the drought comes around, versus those who have done the opposite. From what I can read you belong to the latter group.
A former colleague of mine made really good money in the 90s but spent most of it on things he really did not need. Then his company folded and his upper 10% seniority number didn’t mean squat. For several years he was working really low paying jobs (think $60k/year as a 737 captain) until he finally landed at my old employer and he once again was making good money, until the plane sold two years before him reaching 65. Had he managed his financials more responsibly back while he was raking it in he probably would not have to sweat during the last year leading to his retirement.
My hope with these past postings is that those much younger than me listen to what is being said and learn from those of us who have been around for a few economic cycles, both when it comes to success stories and mistakes. Many of today’s younger generation who entered aviation post GFC have seen nothing but upward pressure on salaries, more jobs available than in a long time, stock market just going up and up along with property prices. It is very easy to get naive and complacent in an environment like that.
Last edited by FlyTCI; 21st Aug 2020 at 17:42.
Join Date: Jul 2020
Location: Changes
Posts: 217
Likes: 0
Received 0 Likes
on
0 Posts
I am a saver and thank god for that. I am very worried about the future, I don’t know how others who didn’t feel. That said maybe the reason others don’t save is that they don’t worry about tomorrow and live for today, so in actual fact may conversely not be stressed at all by this.
The Cooler King
Join Date: Feb 2004
Location: In the Desert
Posts: 1,703
Likes: 0
Received 0 Likes
on
0 Posts
Leaving aside all the morals of it etc: if you want to do a runner on a loan you can do so.
But you can never return to the UAE as you will be stopped once the case at the public prosecutor's office gets registered.
If you travel to another GCC state you will not be detained for a loan default in Dubai. This is nonsense.
We had an employee go rogue here a few years back and defaulted in about 600,000 AED in loans, wrecked a rental car, and had a police case for leaving the scene of an accident.
He went to work in the country next door and never had an issue in the five additional years he stayed there - flying in and out all the time for business.
Once he stayed out of the UAE, he was fine.
(That being said, he always felt uncomfortable during foggy mornings when an airport closure could give AUH or DXB as an alternate.)
(From a friend who is a risk manager in a bank) If your loan is sizable enough - over 500,000 AED, you do run the risk of them coming to your country and looking for you, however if it is the UK or the EU you are under no obligation to entertain any contact as it's not a criminal case there. (Both countries have to be in agreement on the legalities of the 'crime' in question.)
According to contact, any less than 500,000 or even more is not economically viable to pursue through the courts in another country, and they are not coming after you.
But they will pick you up should you land in the UAE again.
The numbers he quoted about the people they do go after are huge.
Guys who did runner on 5,000,000 or 10,000,000 AED loans.
He tells me that most of the time, the letters etc are to prove to insurance companies that they actively sought to get the money back. After, I think it's two years without contact, the insurance pays out on the remainder.
But you can never return to the UAE as you will be stopped once the case at the public prosecutor's office gets registered.
If you travel to another GCC state you will not be detained for a loan default in Dubai. This is nonsense.
We had an employee go rogue here a few years back and defaulted in about 600,000 AED in loans, wrecked a rental car, and had a police case for leaving the scene of an accident.
He went to work in the country next door and never had an issue in the five additional years he stayed there - flying in and out all the time for business.
Once he stayed out of the UAE, he was fine.
(That being said, he always felt uncomfortable during foggy mornings when an airport closure could give AUH or DXB as an alternate.)
(From a friend who is a risk manager in a bank) If your loan is sizable enough - over 500,000 AED, you do run the risk of them coming to your country and looking for you, however if it is the UK or the EU you are under no obligation to entertain any contact as it's not a criminal case there. (Both countries have to be in agreement on the legalities of the 'crime' in question.)
According to contact, any less than 500,000 or even more is not economically viable to pursue through the courts in another country, and they are not coming after you.
But they will pick you up should you land in the UAE again.
The numbers he quoted about the people they do go after are huge.
Guys who did runner on 5,000,000 or 10,000,000 AED loans.
He tells me that most of the time, the letters etc are to prove to insurance companies that they actively sought to get the money back. After, I think it's two years without contact, the insurance pays out on the remainder.
Last edited by Farrell; 22nd Aug 2020 at 04:51.
Join Date: Jun 2020
Location: Muscat
Posts: 28
Likes: 0
Received 0 Likes
on
0 Posts
Thieves
Unbelievable! What a bunch of thieving, conceited, belligerent *********... First you get the job of a life time, get paid more than you could ever imagine. Pandemic happens.. All get together and beech about the employer, then, on top of alp that, advice each other how to do a runner on loans... Wow wow wow peeps...
Real class act..
Real class act..
Join Date: Jul 2020
Location: Changes
Posts: 217
Likes: 0
Received 0 Likes
on
0 Posts
Employers that throw you out at the drop of a hat, that dont even give you a reason why, that pick on people who have perfect records other than minor surgery, that change contracts because its a Tuesday, that dont follow the contracts that are written. Most companies worldwide have managed to keep employees on on lower salaries instead of throwing them away like trash. As for salaries that you could never imagine.....hardly, and they have been going south for many many years. Shall I go on?
And if you read back over the thread its mainly advocating people sort out their debts and loans and not to do a runner.
And if you read back over the thread its mainly advocating people sort out their debts and loans and not to do a runner.
The Cooler King
Join Date: Feb 2004
Location: In the Desert
Posts: 1,703
Likes: 0
Received 0 Likes
on
0 Posts
I am in no way condoning running out on a loan.
Am simply clarifying what the real situation is here.
The bigger issue is folks hugely overextending themselves on credit cards and finance.
Bitching about being fired is indeed annoying as everyone who comes here knows that it can all end in a few days.
This should not come as a surprise. There are numerous examples on these forums going back over a decade.
But people will still risk it borrowing 400000 AED for a Landcruiser on 40000 AED a month with 30000 AED expenses.
It's ridiculous when you think about it since as pilots, good decision-making is an expectation
Am simply clarifying what the real situation is here.
The bigger issue is folks hugely overextending themselves on credit cards and finance.
Bitching about being fired is indeed annoying as everyone who comes here knows that it can all end in a few days.
This should not come as a surprise. There are numerous examples on these forums going back over a decade.
But people will still risk it borrowing 400000 AED for a Landcruiser on 40000 AED a month with 30000 AED expenses.
It's ridiculous when you think about it since as pilots, good decision-making is an expectation
Join Date: Jan 2003
Location: 2000
Posts: 194
Likes: 0
Received 0 Likes
on
0 Posts
As someone said above, putting the moral and ethical implications aside, the issue may not be as straight forward as “just not returning to the UAE”.
According to friends (yes, more than one) of mine the UAE debt can be sold to collection agencies (in these cases, the UK). The UAE bank gets some pennies on the dollar and can then wash their hands of the situation bar the insurance claim. The debt can then be collected by the said agency in accord with the laws of the home country. On the other hand, the borrower then has all the debt management and repayment options that are available to a debtor in the UK.
The collection firm may well try to work with the debtor as best they can, and that means the debtor could do a DMP, IVA, or go bankrupt and include the account. So, if a debt that originated in the UAE is being collected in the UK, the borrower has all the available debt options in the UK (in this example) at their disposal.
It should be noted that the protection afforded the debtor in an IVA or in bankruptcy etc, generally only pertains to one’s home country. If the debtor were to then return to the UAE they could then be chased for the account, and face the full ramifications of the UAE’s collection process……so little gained.
Furthermore, the collection agency may not be so accommodating. I know of another chap that left the UAE and went to Iran (as an expat), leaving behind a not insignificant loan. His debt was sold to a collection agency but in his case, they hounded him on social media, Facebook, WhatsApp, email, general online trolling, and the like. Some years later it is still going on and still causes him the occasional restless night.
So, there are options available (other than having sleepless nights having done a “runner”) to work out a repayment plan based on what you can afford or be relieved of the debt entirely through insolvency measures.
According to friends (yes, more than one) of mine the UAE debt can be sold to collection agencies (in these cases, the UK). The UAE bank gets some pennies on the dollar and can then wash their hands of the situation bar the insurance claim. The debt can then be collected by the said agency in accord with the laws of the home country. On the other hand, the borrower then has all the debt management and repayment options that are available to a debtor in the UK.
The collection firm may well try to work with the debtor as best they can, and that means the debtor could do a DMP, IVA, or go bankrupt and include the account. So, if a debt that originated in the UAE is being collected in the UK, the borrower has all the available debt options in the UK (in this example) at their disposal.
It should be noted that the protection afforded the debtor in an IVA or in bankruptcy etc, generally only pertains to one’s home country. If the debtor were to then return to the UAE they could then be chased for the account, and face the full ramifications of the UAE’s collection process……so little gained.
Furthermore, the collection agency may not be so accommodating. I know of another chap that left the UAE and went to Iran (as an expat), leaving behind a not insignificant loan. His debt was sold to a collection agency but in his case, they hounded him on social media, Facebook, WhatsApp, email, general online trolling, and the like. Some years later it is still going on and still causes him the occasional restless night.
So, there are options available (other than having sleepless nights having done a “runner”) to work out a repayment plan based on what you can afford or be relieved of the debt entirely through insolvency measures.
Join Date: Aug 2008
Location: UK
Posts: 135
Likes: 0
Received 0 Likes
on
0 Posts
Debt collection agencies in the U.K. have all the same legal power as your local street sweeper. I.e none.
If a UAE bank instructs a debt collection agency in the U.K. to pursue the outstanding debt then you do not need to engage with them at all, should you so wish. They may send letters, they may call you, however they are not allowed to harass via phone, text, in person, on social media or by any other means. They may not discuss the issue with your friends or family, work colleagues or anyone else unless you have instructed those persons to do so o your behalf. They may not enter your home unless invited. They may not attend your work for any reason. There are laws governing their behaviour and complaint should be made if any of the above should take place.
If the creditor takes the debtor to court in the UAE and they receive a judgement in their favour then they may then look to the courts in the U.K. for enforcement. Generally U.K. courts will not entertainment enforcement while there is a chance of appeal in the UAE. Only after the appeal period has passed will they then look to recognise and enforce the foreign judgment.
At that point then they may instruct enforcement agents (England) or sheriffs officers (Scotland) to enforce collection of the debt, should no repayment agreement be in place.
These agents have all the powers of the court and can remove items for sale at auction to pay towards the costs of the outstanding debt. They can, and will, enter your home in order to do this.
The key is communication. I would encourage talks between the debtor and creditor to come to some agreement. Token payments until such time as you are able to increase repayment would be looked upon favourably by the court. Don’t bury your head in the sand.
Good luck to all.
If a UAE bank instructs a debt collection agency in the U.K. to pursue the outstanding debt then you do not need to engage with them at all, should you so wish. They may send letters, they may call you, however they are not allowed to harass via phone, text, in person, on social media or by any other means. They may not discuss the issue with your friends or family, work colleagues or anyone else unless you have instructed those persons to do so o your behalf. They may not enter your home unless invited. They may not attend your work for any reason. There are laws governing their behaviour and complaint should be made if any of the above should take place.
If the creditor takes the debtor to court in the UAE and they receive a judgement in their favour then they may then look to the courts in the U.K. for enforcement. Generally U.K. courts will not entertainment enforcement while there is a chance of appeal in the UAE. Only after the appeal period has passed will they then look to recognise and enforce the foreign judgment.
At that point then they may instruct enforcement agents (England) or sheriffs officers (Scotland) to enforce collection of the debt, should no repayment agreement be in place.
These agents have all the powers of the court and can remove items for sale at auction to pay towards the costs of the outstanding debt. They can, and will, enter your home in order to do this.
The key is communication. I would encourage talks between the debtor and creditor to come to some agreement. Token payments until such time as you are able to increase repayment would be looked upon favourably by the court. Don’t bury your head in the sand.
Good luck to all.