Can a bank sue a pensioner

[johnmcc6]

An Australian aquaintance was in a bad cycle accident and had to max out his bank card to pay the bills. He has no way to ever pay it back. He has enough money to meet his visa obligations but thats it. What, if anything can the bank do to him? He lives here at the moment on retirement visa.

[CMBob]

Presuming your acquaintance has a question about his legal liability here in Thailand, the logical thing would be for him to consult with a Thai lawyer. Or, presuming your friend really wants you to involve yourself in his issues, perhaps you could do so.

[naboo]

The maxed out bank card - Thai or Australian? Credit card or debit card?

[johnmcc6]

Presuming your acquaintance has a question about his legal liability here in Thailand, the logical thing would be for him to consult with a Thai lawyer. Or, presuming your friend really wants you to involve yourself in his issues, perhaps you could do so.

I don't really want to get too involved with it. I was just curious and hoping someone here may have come accross this before. I had a friend in Oz who was a blind pensioner who had already lost his home and owed heaps on a number of cards he should never have had in the first place. I contacted all the banks and lawyers on his behalf and they all just wrote it off. Not one followed up to see if it was even true what i was telling them. This was around $60,000 dollars.

[Chicog]

If he's got nowt back in Australia then what can they do?

Get a court judgement against him.

They aren't going to extradite him.

But it's sad that people put themselves in such a vulnerable position.

Just stupid if you ask me.

[simple1]

You could try the same tactic as you did for your other friend. The question is whether the bank will bother to list him as a bankrupt. Although it's likely he would be permitted to travel outside of Oz for short periods, if he is declared bankrupt & if he returns to Oz he will not be able to permanently depart for a minimum of three years unless he clears his debt.

More detail at www.afsa.gov.au

[NancyL]

He should have talked with the hospital about making arrangements to pay the bill on a contract. Also, if he was in a private hospital, he should have been transferred into a gov't hospital as soon possible where the costs would have been much lower.

If he has a pension, then he could be using the "combo" method to justify his retirement visa and doesn't need to have a full 800,000 baht in a bank account.

Credit cards can be paid over time. He should make arrangements with the credit card company.

There are very few pensioners who can't change their lifestyle in order to come up with another 5000 or 10,000 baht/month in order to pay off a debt.

[AlexRRR]

Obviously the bank and i assume an Aussie bank will cancel his card if its maxed out and no repayments going in, since he lives in Thailand they can't do much, but its always better to negotiate with the bank, you should get this guy to negotiate a payment scheme, he may need is credit card again one day.

Don't believe for one moment he could never pay it back, maybe $10,000 credit limit maybe 12 on his card at least he should try, me i wouldn't want to be caught without the security of a credit card if i was out of Australia.

[cyberfarang]

He could be sued for defrauding by maxing out his card knowing he had no means to pay the money back. The bank could make him pay back from his visa money. That`s my guess.

[BB1955]

I can only speak about the in the USA . If you max out a card and fail to pay , they must serve you and take you to court to get a judgement . Then once they get the judgement and you fail to pay that , they must get an attachment of earnings through the courts . Then if you have money in the bank or a pension not attached to social security they can attach that . But you must be served . More to do all that then to just write it all off which most credit card companies will do .

[Dante99]

There are very few pensioners who can't change their lifestyle in order to come up with another 5000 or 10,000 baht/month in order to pay off a debt.

Or 5000 Baht/year to pay a visa agent?

Anyway back to the topic which is a whole lot of speculation since we do not know if it is a Thai Bank credit card, Australian Bank, US Bank or Burmese Bank....???

Then we got a guy asking if it is a credit or debit card, how do you max out a debit card and create a debt?

how about a few more facts from the OP

[CMBob]

I can only speak about the in the USA . If you max out a card and fail to pay , they must serve you and take you to court to get a judgement . Then once they get the judgement and you fail to pay that , they must get an attachment of earnings through the courts . Then if you have money in the bank or a pension not attached to social security they can attach that . But you must be served . More to do all that then to just write it all off which most credit card companies will do .

While we're likely swerving off topic, service of process can be made by publication in a newspaper (in the county of the debtor's last residence) if the bank (creditor) can't find you after some reasonable but relatively minimal efforts to personally serve the debtor. Once a judgment is obtained, obtaining a writ of garnishment to grab onto bank funds in that country does not require any additional personal service.

Even though the OP didn't specify the basics, I presume he's talking about an Australian debt that belongs to an Australian permanently living here. Theoretically, the Australian bank could (1) obtain an Australian judgment and then garnish an Australian bank (presuming the debtor has any funds there....which sounds doubtful). (2) obtain an Australian judgment, get it certified here as a Thai judgment, and then use the Thai courts to garnish bank funds here, or (3) file suit here in Thailand and then garnish bank funds here. The likelihood of either #2 or #3 happening is probably about zero.

[fang37]

Why not?

However they would need to consider the effect on doing so on their reputation.

[trainman34014]

I had an English pal that maxed out his six credit cards, including buying his ticket to Thailand and then just skipped the country. They chased his family for a few months but everyone told them he was gone forever and had no intention of returning. Once they were satisfied he was actually gone they gave up and wrote the whole lot off...about 20,000 quid. That was six years ago and he's never heard a thing since....he's now 80.

Some people seem to be able to live with this kind of guilt....indeed; perhaps they don't feel guilty at all about ripping off a banking industry that are themselves no more than legalised criminal institutions !

[Konini]

I have assumed, perhaps incorrectly but likely not, that him being called a pensioner (different meaning in Australia than to UK, basically anyone on any benefit is called a pensioner regardless of age) that he is on the age pension with no private superannuation, which means he doesn't have anything else. This is usually what it means if an older person is 'a pensioner'.

The banks can't garnish his income as it is the bare minimum he needs to survive as determined by the government.

Very sad, and a warning to all those who don't have health insurance or a very good buffer fund.

[billd766]

The maxed out bank card - Thai or Australian? Credit card or debit card?

I don't think it is possible to max out a debit card because it will only pay out while there is money in the account.

When the money in the account is no more the debit card is useless.

Credit cards are different.

In the UK IIRC a credit card is classed as an unsecured debt and if it gets maxed out deliberately that may be classed as fraud and is a criminal offence. However if you lose your job, fall on hard times etc and cannot repay the debt, get in touch with the credit card issuer asap and offer to pay the maximum amount you can afford.

The problem then is that your credit rating falls through the floor.

Other countries may have different rules and laws.

[Chicog]

I had an English pal that maxed out his six credit cards, including buying his ticket to Thailand and then just skipped the country. They chased his family for a few months but everyone told them he was gone forever and had no intention of returning. Once they were satisfied he was actually gone they gave up and wrote the whole lot off...about 20,000 quid. That was six years ago and he's never heard a thing since....he's now 80.

Some people seem to be able to live with this kind of guilt....indeed; perhaps they don't feel guilty at all about ripping off a banking industry that are themselves no more than legalised criminal institutions !

And how do you think the banks make up shortfalls from scumbags like this?

[shirtless]

The bank cannot serve you in this matter while you are in Thailand , dont make a payment for 7 Years and debt is legally null and void , they will mark your cra that will only affect you if you needed more credit

[Rancid]

As already said little the bank can do if out of Australia. So he could negotiate with the bank now or eventually the case will be sold to a debt collection agency.

The agency may find him in Thailand and if so will bluster on but in reality can do nothing either. Here he gets a second chance to negotiate a deal with them that should include clearing his credit rating.

[NancyL]

Realistically, the OP's friend should be more concerned about what he's going to do if he has another health crisis.

As he learned, there is no free health care for foreigners here in Thailand. If he has no way to pay a medical bill, private hospitals will hold his passport until he can and the public hospital will report him to Thai Immigration if he walks away from a payment contract. (but they won't hold his passport.)

Let's hope he's staying off motorbikes now. That's a good start.

[cyberfarang]

There are very few pensioners who can't change their lifestyle in order to come up with another 5000 or 10,000 baht/month in order to pay off a debt.

Or 5000 Baht/year to pay a visa agent?

Anyway back to the topic which is a whole lot of speculation since we do not know if it is a Thai Bank credit card, Australian Bank, US Bank or Burmese Bank....???

Then we got a guy asking if it is a credit or debit card, how do you max out a debit card and create a debt?

how about a few more facts from the OP

Well said.

[TheSiemReaper]

The debt is almost certainly non-recoverable - that doesn't mean your chum gets away with non-payment. His bank, assuming it's the one in Australia, will go through their usual debt collection process... which means his credit rating at home will be lousy if he goes home and if he goes home, they'll be following up on collection no matter how his circumstances are.

While debts are normally enforceable globally, in practice - it's nigh on impossible for an Australian bank to collect a debt in Thailand. It's more likely the debt will be sold on at 30% of the $ value to a debt collection agency and they will try to collect at home.

If it's a Thai bank... the reverse would be true if he now fled to Australia.

There is no statute of limitations on a debt you incur knowingly. If, for example, you run up an overdraft, pay it off (but miss a small portion) and then leave your country and come back 7 years later - they will normally write that off because you didn't know and they didn't contact you to put it right (mainly because they couldn't). But there's no point at which a debt (like a hospital bill) just gets written off... however, if you do want to clear the debt for pennies on the dollar. The best time to make an offer is after your bank threatens to sell the debt on to a debt collection agency - 35% of the figure as a lump sum will do the trick (it's more than they'd have got from the agency). You can also get them to clear your credit rating at the same time if you do that.

[konying]

If it's a credit card, bank can not and will not do anything.

Credit cards are an unsecured credit, hence the crazy interest rates.

Bank will sell the debt to collection agency who will annoy you endlessly.

Despite what "experts " on Thai visa like to believe , bank will struggle to get a court judgement on a credit card debt, furthermore legal costs would be very high with no recourse.

Banks know this and that's why they sell the debt to collection agency for a fraction of the debt and write off the rest as a loss, ie tax deduction

[konying]

The debt is almost certainly non-recoverable - that doesn't mean your chum gets away with non-payment. His bank, assuming it's the one in Australia, will go through their usual debt collection process... which means his credit rating at home will be lousy if he goes home and if he goes home, they'll be following up on collection no matter how his circumstances are.

While debts are normally enforceable globally, in practice - it's nigh on impossible for an Australian bank to collect a debt in Thailand. It's more likely the debt will be sold on at 30% of the $ value to a debt collection agency and they will try to collect at home.

If it's a Thai bank... the reverse would be true if he now fled to Australia.

There is no statute of limitations on a debt you incur knowingly. If, for example, you run up an overdraft, pay it off (but miss a small portion) and then leave your country and come back 7 years later - they will normally write that off because you didn't know and they didn't contact you to put it right (mainly because they couldn't). But there's no point at which a debt (like a hospital bill) just gets written off... however, if you do want to clear the debt for pennies on the dollar. The best time to make an offer is after your bank threatens to sell the debt on to a debt collection agency - 35% of the figure as a lump sum will do the trick (it's more than they'd have got from the agency). You can also get them to clear your credit rating at the same time if you do that.

Bad debt gets written off and your credit cleared after 7 years( from memory)

New law introduced few years ago allows you to tell who ever is harassing to stop calling as an official warning. Should they ignore it, a complaint to ombudsman gets company fined $10000-$100000 per incident.

[johnmcc6]

It is a visa card from Australia from west pac bank. Over 20,000 in cash drawn on it.

$35,000 limit

There are very few pensioners who can't change their lifestyle in order to come up with another 5000 or 10,000 baht/month in order to pay off a debt.

Or 5000 Baht/year to pay a visa agent?

Anyway back to the topic which is a whole lot of speculation since we do not know if it is a Thai Bank credit card, Australian Bank, US Bank or Burmese Bank....???

Then we got a guy asking if it is a credit or debit card, how do you max out a debit card and create a debt?

how about a few more facts from the OP

[Jip99]

The debt is almost certainly non-recoverable - that doesn't mean your chum gets away with non-payment. His bank, assuming it's the one in Australia, will go through their usual debt collection process... which means his credit rating at home will be lousy if he goes home and if he goes home, they'll be following up on collection no matter how his circumstances are.

While debts are normally enforceable globally, in practice - it's nigh on impossible for an Australian bank to collect a debt in Thailand. It's more likely the debt will be sold on at 30% of the $ value to a debt collection agency and they will try to collect at home.

If it's a Thai bank... the reverse would be true if he now fled to Australia.

There is no statute of limitations on a debt you incur knowingly. If, for example, you run up an overdraft, pay it off (but miss a small portion) and then leave your country and come back 7 years later - they will normally write that off because you didn't know and they didn't contact you to put it right (mainly because they couldn't). But there's no point at which a debt (like a hospital bill) just gets written off... however, if you do want to clear the debt for pennies on the dollar. The best time to make an offer is after your bank threatens to sell the debt on to a debt collection agency - 35% of the figure as a lump sum will do the trick (it's more than they'd have got from the agency). You can also get them to clear your credit rating at the same time if you do that.

Pretty much spot on.

The bank will huff and puff, the the debt recovery agent will huff and pudd - then they will all go away. There is no commercial benefit in trying to pursue a lost cause in Thailand.

Credit rating scuppered (this was a one of chance to pay to medical treatment - that card is now used up), no matter as I imagine that the individual will never return to Oz and will see his years out here, hopefully without any further medical costs.

The other customers of the bank pay for the written-off debt

[bangmai]

He needs to worry more about being a loser, than the unsecured debt he will fail to pay. He's lucky it isn't a Thai Bank. because my understanding is that financial insolvency is grounds for deportation....it would also bring into question the legitimacy of his letter about his income or his savings. I grew up the son of Depression kids, as a result I think I was fooled into believing that older people are generally frugal and good with money. Since then, I have seen those considered to be pillars of the community zeroed out by dotcom and the real estate bubble. Some of the older baby boomers seem to be especially bad with money, as a number of them are quite a bet worse off than before they inherited a large chunk of money from their late parents. One guy in a similar situation on his Discover Card. He is now teaching English in Colombia, but knew all along that he was going to stop paying his card, once he got there. His dad had left him 3000 shares of IBM in 1999, and his friends convinced him to sell and buy internet stocks. He even has a degree in Finance from Boulder.

[MaeJoMTB]

Credit Card debt in the west is generally 'unsecured'.

That means you only have to pay it back if you want to.

So as they say, pay or not, up to you.

Lets not get into the 'moral obligation' discussion, western financial institutions have no morals, so why should we?

Edited December 12, 2015 by MaeJoMTB

[Mousehound]

I need to state I am not an expert or qualified as an advisor in any way but here are a few thoughts that are not covered so far:

If he just not able to pay he may be better off to declare bankruptcy. However, he would then need to get permission he could offer to pay off the debt at a written down amount. An offer could be pretty small but it would keep him solvent.

If he declares bankrupt he would need to obtain permission to leave Australia should he return.

His Australian pension most certainly could not be touched. However, if he has assets of any kind other than superannuation these could be. Super is protected to some extent provided he has not stripped the fund prior to filing for bankruptcy. A self managed fund could be difficult depending how it was set up. I mention this as many Australians are getting a pension from the government which is adjusted to take into account super funds. So he may have 80% from the government and 20% from the super fund for instance.

Check to see which department is actually paying the pension - it could for instance be Veterans Affairs. In any event all pension paying departments have financial advisors who can be contacted. There is also Citizens Advise that may be worth a try. Obviously the best would be a big legal firm but clearly this would not be a financial option.

As mentioned - harassment over unpaid debts carries very heavy fines in Australia and does not happen - at least through these sort of debts.

American bankruptcy laws can be quite different to Australia.

[bangmai]

Yes, of course it is different, but just out of interest, here is an example of a woman in Arizona being hospitalized on 9 December 1997, and released on 14 January 1998. 161K USD was the bill. It took them all of 9 days to get a lien against her, in a court recorded document.

19980048100.pdf

As far as not paying unsecured debt being a choice...that is true, kind of....if you took the credit or the cash without any intention of paying it back, that's clearly bank fraud, but intent is difficult to prove. In the end, the consumer/taxpayer pays as people with 800 credit scores are still routinely issued 15% APR credit cards.