what happens to student loans if i leave the country

[VVSHT]

as the title says, what do you think would happen to student loans if I move to another country right after residency and practice there forever. Ofcourse I would have to make sure my parents come with me too since they are the cosigners and I dont want them to be screwed. Do you think they would find me? Even if they did, what could they do? This also happens to be a sort of "developing" country with rampant bribery/corruption within the government, and a lot of the high ranking police officials in the city happen to be my relatives. I pretty much know that the the local cops would never even try to come after me?

before i get flamed, im not planning on actually doing this. I love living here and wont really have too much debt going to my state school. just curious if anyone has ever tried doing this.

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[lilqu]

You can't be serious....

 

[kdavidlee25]

loans still stay with you wherever you go. obviously, if you go to another country, it will be harder to collect on those debts. but then, your credit will be ruined, and any chance of you trying to find a professional job in america will be zero.

 

[kdavidlee25]

pakistan?

 

[DrMidlife]

The OP specifically said this is hypothetical.

Hypothetically, after you disappear, your loan servicer spends months trying to find you and get you to come clean. Your loan servicer is within their rights to completely tank your credit, for a 5-7 year period, after 3 months of non-payment. I have no idea if your US credit rating plays any kind of international role.

Then the loan servicer hands it over to the US gov't, which eventually will seize anything left in the US. You would lose any property, financial instruments, wages etc.

If you came back to the US for any reason, such as to visit friends or any remaining relatives, or for training or conferences, you would be subject to arrest. If you have a common name, or if a parent or child shares your name, they'd be highly likely to be arrested in mistaken identity, and it would take a long time to get that figured out since you can't come to the US. Your family and friends would get calls and letters for years looking for info about your whereabouts, and these calls/letters would seem completely threatening despite having no actual teeth (your family and friends have no liability for your acts unless they are complicit).

I imagine there are thresholds above which you would be sought for extradition from your new country. Such a threshold might be more than $500k, which an average student debt load of $250k would become within a few years, counting fees etc. I have no idea what foreign governments do with requests for extradition from the US, but I would be surprised if such a thing has no effect on your livelihood overseas.

If, down the road, you wanted to come clean, you're deep in fees and penalties and additional interest, and you'll have to pay a lawyer, not so much to defend you, but to get you a deal that minimizes your prison sentence and preserves your ability to practice medicine etc. So there are no "backsies" in walking away from a federal obligation.

Judge for yourself if the downside outweighs the upside.

 

[kdavidlee25]

The OP specifically said this is hypothetical.

Hypothetically, after you disappear, your loan servicer spends months trying to find you and get you to come clean. Your loan servicer is within their rights to completely tank your credit, for a 5-7 year period, after 3 months of non-payment. I have no idea if your US credit rating plays any kind of international role.

Then the loan servicer hands it over to the US gov't, which eventually will seize anything left in the US. You would lose any property, financial instruments, wages etc.

If you came back to the US for any reason, such as to visit friends or any remaining relatives, or for training or conferences, you would be subject to arrest. If you have a common name, or if a parent or child shares your name, they'd be highly likely to be arrested in mistaken identity, and it would take a long time to get that figured out since you can't come to the US. Your family and friends would get calls and letters for years looking for info about your whereabouts, and these calls/letters would seem completely threatening despite having no actual teeth (your family and friends have no liability for your acts unless they are complicit).

I imagine there are thresholds above which you would be sought for extradition from your new country. Such a threshold might be more than $500k, which an average student debt load of $250k would become within a few years, counting fees etc. I have no idea what foreign governments do with requests for extradition from the US, but I would be surprised if such a thing has no effect on your livelihood overseas.

If, down the road, you wanted to come clean, you're deep in fees and penalties and additional interest, and you'll have to pay a lawyer, not so much to defend you, but to get you a deal that minimizes your prison sentence and preserves your ability to practice medicine etc. So there are no "backsies" in walking away from a federal obligation.

Judge for yourself if the downside outweighs the upside.

what?? nothing of what you said will happen. The US sells the debt to third party debt collectors and they in turn will try to attach wages, tax refunds, etc. no one is getting extradited, arrested, kidnapped... The US is far too busy for that.

r u really a med student? you must be a debt collector in disguise.

 

[DrMidlife]

I suggest you watch too many movies. An arrest or an arrest order isn't a kidnapping. It's an entry into a boring, expensive, years-long life-sucking process. An extradition order isn't an extradition. An extradition would probably be over faster and cost less. These things are on the extreme end of consequences for ditching federal debt. There are a million smaller possibilities that are also boring, costly, painful and interminable for the borrower and the borrower's family. Or maybe just inconvenient, like not being able to get your transcripts. Or maybe nothing would happen at all.

Federal student loans, lately, aren't owned by the servicers, such as Sallie Mae. They're held by the dept of Ed, which pays servicers to collect payments. The Ed dept can, and does, use collection agencies, but they can also do whatever they want, instead or in addition. Mistakes are made...often...it's government. Options not requiring creativity or followup are favored.

Keep in mind we're talking about principal balances that are up over $500k at the end of med school now. This isn't a credit card bill. Do you think the IRS lets that go? Ever?

 

[Ruby claire]

It will be difficult for you to find a job because the companies will do credit check before hiring you!!

 

[kdavidlee25]

You're saying I watch too many movies ???? You're the one who first talked about arrests, extraditions... I'm in the Twilight Zone.

 

[whidbeyboy]

It will be difficult for you to find a job because the companies will do credit check before hiring you!!

I haven't heard any right answer from anyone here yet.

1. If you go overseas your debt here would increase but so what? You don't plan on paying them anyway.

2. Other countries have no idea and would laugh at the idea of someone going to jail over a student debt, as many pay for college as a government program, just like the one payor system.

3. They will not come knocking on your door. First, it cost too much to find you and bring you back, and second what are they going to do even if they could? Make you work the salt mines? Jail? For being poor? That's a good one. Please show ONE example.

If someone can't pay for what ever reason, health, lack of income, mental issues (you have to be crazy to borrow this much money where no escape is possible without total financial devastation for life). They cannot do anything to you unless you stay here and work, and they CANNOT do that.

Especially if you become a citizen of another country, as you would want to anyway.

Many people have left the country to avoid constant harrassment from very, very evil collection agencies. Most live a good life now with more freedom then they had here in the US of A. Ironic.

 

[whidbeyboy]

It will be difficult for you to find a job because the companies will do credit check before hiring you!!

Ha, ha. Really? Do you think they do that in any country outside the US?

I'm sure in France where the Government pays people to go to med school and college, they would think you were a refugee and give you a home and a job.

China states our student loan system is a human rights issue, I know ironic, but still. I really would not worry about credit checks or anything else.

The ONLY consideration to me would be having to leave heart and home.

 

[QualityProcess]

I think Dr. Midlife was referring to prison time for tax evasion... not sure though

 

[whidbeyboy]

Victoria stated: Just because not paying up is unethical, unpatriotic and illegal does not mean that it is life-ruining if you do it.

Is it unethical to be poor enough not to pay the loans? Unpatriotic? Not sure that flys, how many people walked away from thier home loans when the bubble burst? Did they hate America?

And it is not illegal either. If being poor and broke was a crime, then we need more jails.

People think that student loans are unpaid because someone just dosen't want to pay it, but it's because people cannot afford to pay it. No refinance rights or truth in lending? How convienent for the banks.

And the way it is set up what stops the banks from lending money they must know will never be repaid. Lending $200,000 for a BA? It happens and the tax payers will pay for it as usual. Why would they not lend like crazy knowing this. NO accountability!

Because of this SL debt has surpassed all other debts. It's a scam, and many politicians are in on it. So don't expect to see any consideration for US citizens who are unable to pay them back and are in a state of despair.

 

[dpmd]

People think that student loans are unpaid because someone just dosen't want to pay it, but it's because people cannot afford to pay it. No refinance rights or truth in lending? How convienent for the banks.

I find it hard to believe that all the student loans in default are from people who could not afford to make any kind of payment at all considering that they offer a variety of deferments, forbearances, and alternative payment plans. You don't go immediately into default. You have to make a persistent effort to ignore the loan for many months, including ignoring letters offering info on what to do if you can't afford to make payments, followed by ignoring calls.

Not sure what you mean by "no truth in lending". You sign a very detailed promissory note when you take out student loans that tell you everything about the loan if you just bother to read the damn thing. There isn't anything they charge or do that you can't find in that promissory note. If you can't be bothered to read a contract, and UNDERSTAND IT, before you sign it I don't know what to tell you.

As for refinance rights, you have every right to obtain a different loan in order to pay off your student loan. However, without any kind of asset to back up the loan, I doubt you will get any terms that would be as generous as the student loan. Yes, I called the terms generous. I don't know what else you could call an unsecured loan that doesn't have any penalty increase in interest rates or predatory fees for late payments, that has flexible repayment terms and clauses that allow for discharge of the loan if certain conditions are met, and allows you to delay repayment while in school/unemployed/deployed in the military/or don't make enough money.

 

[YumYumGum]

I find myself in this exact position years after I have graduated. The amount I owe is ridiculous. At present I'm considering leaving the country and starting life anew somewhere else. I don't want to leave, I love this country, I love the people, my friends, my family. Unfortunately I just can't live the life that I want to live when I'm paying close to $20k yearly in student loans and making around 60k/year after taxes. I don't have a significant other to help me and honestly I don't think I want to bring anyone else into this miserable financial state I find myself stuck in. I guess I thought putting my head down and plugging through med school would at least get me a decent living wage, enough to buy a home, maybe go on a vacation once a year?

I just feel like I screwed myself by trying to follow the American dream and now that dream is gone and someone else is profiting from my hard work.

 

[DoccoDoc]

as the title says, what do you think would happen to student loans if I move to another country right after residency and practice there forever. Ofcourse I would have to make sure my parents come with me too since they are the cosigners and I dont want them to be screwed. Do you think they would find me? Even if they did, what could they do? This also happens to be a sort of "developing" country with rampant bribery/corruption within the government, and a lot of the high ranking police officials in the city happen to be my relatives. I pretty much know that the the local cops would never even try to come after me?

before i get flamed, im not planning on actually doing this. I love living here and wont really have too much debt going to my state school. just curious if anyone has ever tried doing this.

If you wind up delinquent on your loans you will destroy your credit.

 

[ccmd2b]

You know Obama's investment in Drones? You may be seeing one fly over your clinic..

 

[confettiflyer]

If you maintain US Citizenship - you still have to file a tax return every year even if you exclusively live/work abroad. Since it's a government-backed loan, any refund due to you would be garnished.

But you probably wouldn't have a refund due since you'd be "credited" with whatever local income tax you've paid already.

Any earned benefits (ie Social Security) would be garnished, so anything you've "earned" up until you fled the country would disappear.

So really if you physically left the US and maintain no commercial ties (ie employment) with any US based entity, there's not much anyone can do. Extradition is for criminal offenses.

So really, nothing.

 

[confettiflyer]

Many people have left the country to avoid constant harrassment from very, very evil collection agencies. Most live a good life now with more freedom then they had here in the US of A. Ironic.

"Many people." Cite your sources.

They're stupid. If you get harassed by debt collection agencies in the US, record the call and file a FCRA claim and you get can get $$$$ each time they call you.

I wish debt collectors would harass me, I'd make so much damn money in FCRA claims, it would be ridiculous.

 

[Stroganoff]

"Many people." Cite your sources.

They're stupid. If you get harassed by debt collection agencies in the US, record the call and file a FCRA claim and you get can get $$$$ each time they call you.

I wish debt collectors would harass me, I'd make so much damn money in FCRA claims, it would be ridiculous.

i

FDCPA. And they can call within certain times of the day unless you send them a cease & desist. Calling itself is not a FDCPA violation. And it's a rule of thumb to always deal with debt collectors in writing only, hard copy snail mail USPS Certified Mail, Return Receipt Requested (CMRRR) and never on phone. And never to sign your signature on anything to a debt collector, since they have been known to fraudulently transfer that signature to other documents.

 

[Catalino21]

There was a front page reddit post a few days ago by a guy saying he moved to Europe because he was 120k in debt from student loans and medical expenses. I believe he said hes been there for over a year with no problems legally and is making 100k a year in US dollars. Having trouble finding the post now but it was a pretty interesting read. Most of the top rated comments talked about how this is actually pretty do-able legally.