Credit Card Madness

[ChouDoufu]

Dear thaivisa denizens, here’s my story (the short version). Hoping to hear some advice. Snarky comments welcome if clever and entertaining!

I’ve got a nice little thai lady, possibly getting hitched in the near future. Turns out she has a little debt problem she hasn’t told anyone about. Took a while to get the whole story from her…..

She has seven credit cards maxed out and one personal loan. She also has a friend’s credit card maxed out. Most are charging 20%, one charging 28%. She had no idea how much she actually owes. She has no understanding of interest rates, late fees, collection fees, etc.

Total debt comes to 150% of her annual salary. Monthly payments equal 150% of monthly salary….NOT including two cards demanding full payment immediately. Monthly interest charges, plus late fees and collection fees, are about equal to what I’ve calculated she can actually pay. Up until now, she’s been paying a few cards, waiting a few days until posting, and then taking cash advances to pay other cards. Now at limits, so that’s no longer possible.

There are no parents nor children, but many brothers and sisters who are all doing much better financially. She will not ask relatives for advice (or money). She cannot ask her bestest girlfriends for advice, because they work in……collections.

I’ve gone with her base salary, subtracted rent and utilities, plus a daily amount she should be able to live on. That leaves enough to pay off her personal loan and one cash card (both at her bank where she has direct deposit of her salary), and her friend’s credit card. But what about the other six credit cards? There’s no way she can make any more payments. If she were to negotiate a reduced balance with any of the cards, full payment would be required. There’s simply no money for that.

From research on the intertubes, especially on this here forum, I would advise her to:

1. Pay off personal loan and cash card.
2. Pay off her friend’s credit card.
3. Walk away from the rest. No money....sorry!

She thinks defaulting on credit cards makes her a bad person. Perhaps. Stupid banks give out credit cards to people with no understanding of credit, and no assets or income, what do they expect will happen?

[ChouDoufu]

background info: currently employed in china. in thailand on tourist visa

waiver, and now on extension. managed to open a bank account with

just my passport and tourist visa! will SWIFT the required funds next

month to allow for 3-month ripening. will apply in china where i have

residence permit for either marriage or retirement visa....depending.

alternate reality option is to take new bride back to china for a year

or two........before returning to thailand to retire.

[lopburi3]

Actually it is rather short sighted, in my opinion, to blame the banks. And she should come clean to family and get it taken care of - families do help in such cases if they can believe she can/will reform.

[robblok]

Actually it is rather short sighted, in my opinion, to blame the banks. And she should come clean to family and get it taken care of - families do help in such cases if they can believe she can/will reform.

Of course blaming the banks and jumping debt is much easier as taking responsibility.

[Ks45672]

She sounds like a right scammer tbh...

While it maybe easy to overspend on one credit card, to max out 6 + another one that doesn't even belong to her is a huge red flag imo

I would advise you to walk away from her as you probably have only heard 10% of this story so far..... But I know you won't because , she's different....

Edited February 3, 2016 by Ks45672

[richard_smith237]

How readily can you afford to clear her debt ?

You say you are possibly getting hitch, so she appears to be a keeper but has this debt issue.

An option could be: Pay of Her Debt, leave her with one 'emergency' credit card, cancel all the rest - agree that you see the Credit Card bill each month. In fact you could go a step further, become a second Card Holder, so it looks less strange that you want to see her CC statement each month.

IF you are so inclined you could also have her pay you back, but without the 20-28% interest the Banks are charging.

[MJKT2014]

[Pib]

Sounds like you need to payoff your fiancee's debts so she can begin re-accumulating the debts in marriage.

[i claudius]

I love the credit card laws here in Thailand ,a young lady like this with no money can have 6 credit cards ,but when i asked the bank for one ,(i have quite a lot in this particular bank) so that i could pay for my airfares etc online which i cannot do with a debit card , not a hope , amazing Thailand .

[theguyfromanotherforum]

She is not asking her relatives and family for money, but is asking you?

[fletchsmile]

How much sinsot was she asking for when you "possibly get hitched in the future"? Sounds like she's already working on her solution.

Your solution should be getting her to talk to family first to see if she can get any support in clearing the debts. This may include borrowing on other terms/ different products on her behalf with lower rates, as credit cards have about the highest rates going.

Talk to the banks concerned. Come clean and see what they say

[timberpond]

You might like to watch Boston Legal Season 2 episode 10 - Legal Deficits

Alan Shore solved his secretary's financial troubles.

[BookMan]

When you say 150% of yearly salary.. what amount are you talking about?

20 k x 12?

30k x 12?

100k x 12?

[Myran]

"Walk away from the rest. No money....sorry!"

In other words, you are going to advise her to steal the money. Sounds like you two are perfect for each other.

This is why we can't have nice things.

[theguyfromanotherforum]

You don't walk away from credit cards in Thailand like in the west, I guarantee you that. This is why she is keen on paying off her loan unlike the uninformed op. This is not the west.

[richardt1808]

Red flags and warning bells, my friend.

A person does not change their habits, so while it may be admirable that you are helping her out of a predicament that is relatively small in monetary terms at the present time. Consider, please, what is going to happen a few years down the line when she has access to a bigger line of credit. Indeed, there will be an even bigger debt to clear, because I can guarantee that history WILL repeat itself.

I know a person who previously did exactly the same thing by maxing out 12 credit cards in this way. There was a bail-out of more than 300,000 Baht and friends all breathed a sigh of relief. The clever people all walked away and drew a line, never to be crossed again. Last thing I heard, things had again gone full circle and there was an enormous new debt. The poor guy who had posted guarantees, then lost his business and a 20 Million Baht condo.

[bermondburi]

Tell her to declare herself bankrupt.

Forget about her, major red flag. No one is that stupid that they make the same mistake six times. She knew exactly what she was doing. And you're her get out of jail free.

How could you trust a woman like this with family finances in the future.

Is she really worth it?

So bankrupt our the family sorts her mess out. A bit of humility at her situation might make her realise she's just like everybody else, and has to work for a living.

[ChouDoufu]

from what i read, individuals cannot declare bankruptcy if debts total less than

one million baht. ...... maybe i should get her to charge more stuff?

she is NOT asking me for money. i kept tripping over the piles of monthly

credit card statements.

i don't see her as a scammer. just someone from a culture with no education

provided in personal finance, and a live-for-today attitude. or am i missing

something? are thais famous for their intricate planning and attention to detail?

not the same mistake six or ten or whatever times.....a continuous attempt to

juggle multiple cards, moving cash back and forth to try to meet the deadlines.

same thing happens to many folks in the west as well.

i'm not going to pay off her loans. her responsibility....if she defaults, she has

to live with the consequences. for her that would be a bad credit rating and no

credit cards. but the banks will also have to live with their irresponsible lending.

did convince her to call the legal office number on the collection letter i tripped

over. they've agreed to a 50% settlement to close the account.

one down.

i might could offer to lend her the money to pay one-time settlements for her

delinquent accounts. in the meantime, i have taken away her credit cards....

[lopburi3]

same thing happens to many folks in the west as well

True but do not believe many would be talking marriage; in a joint property state, in that case.

But what may be of even more concern is how these cards were used. Is she really living a life indicating this much cash, or is there perhaps something else these funds are being used for? Gambling is a real issue for many here - and can be as addictive as drink or drugs.

[colinneil]

images.jpg

My thoughts exactly !!Run Forrest run !!

[TheCruncher]

I love the credit card laws here in Thailand ,a young lady like this with no money can have 6 credit cards ,but when i asked the bank for one ,(i have quite a lot in this particular bank) so that i could pay for my airfares etc online which i cannot do with a debit card , not a hope , amazing Thailand .

Well that is a nice lie, because the major banks in Thailand will issue a credit card to foreigner on the condition that you put the limit amount in a fixed deposit account.

[Bantex]

Don't walk away - RUN

If you help her by paying off her debts, do you really think that she will change her spending habits or more likely just max out the cards even quicker?

[blackcab]

from what i read, individuals cannot declare bankruptcy if debts total less than

one million baht. ...... maybe i should get her to charge more stuff?

she is NOT asking me for money. i kept tripping over the piles of monthly

credit card statements.

i don't see her as a scammer. just someone from a culture with no education

provided in personal finance, and a live-for-today attitude. or am i missing

something? are thais famous for their intricate planning and attention to detail?

not the same mistake six or ten or whatever times.....a continuous attempt to

juggle multiple cards, moving cash back and forth to try to meet the deadlines.

same thing happens to many folks in the west as well.

i'm not going to pay off her loans. her responsibility....if she defaults, she has

to live with the consequences. for her that would be a bad credit rating and no

credit cards. but the banks will also have to live with their irresponsible lending.

did convince her to call the legal office number on the collection letter i tripped

over. they've agreed to a 50% settlement to close the account.

one down.

i might could offer to lend her the money to pay one-time settlements for her

delinquent accounts. in the meantime, i have taken away her credit cards....

You have a saviour complex, so you are not going to be told and you are not going to listen.

You have two choices.

1. Pay all her debts for her.

Or before you do that,

2. Read Private Dancer by Stephen Leather. It's a free download.

[jonclark]

from what i read, individuals cannot declare bankruptcy if debts total less than

one million baht. ...... maybe i should get her to charge more stuff?

she is NOT asking me for money. i kept tripping over the piles of monthly

credit card statements.

i don't see her as a scammer. just someone from a culture with no education

provided in personal finance, and a live-for-today attitude. or am i missing

something? are thais famous for their intricate planning and attention to detail?

not the same mistake six or ten or whatever times.....a continuous attempt to

juggle multiple cards, moving cash back and forth to try to meet the deadlines.

same thing happens to many folks in the west as well.

i'm not going to pay off her loans. her responsibility....if she defaults, she has

to live with the consequences. for her that would be a bad credit rating and no

credit cards. but the banks will also have to live with their irresponsible lending.

did convince her to call the legal office number on the collection letter i tripped

over. they've agreed to a 50% settlement to close the account.

one down.

i might could offer to lend her the money to pay one-time settlements for her

delinquent accounts. in the meantime, i have taken away her credit cards....

The easiest in terms of least financially taxing, way to clear the debt is for her to default and get taken to court. In court she will pledge an amount 100 baht a month per card, for the next 20 years. Obviously having 6 cards this will involve 6 court appearances, but without either you or the family paying the debt in full or part, or her winning the lottery she will be lumbered with the debt.

Obviously she will lose face and be blacklisted.

[Halfaboy]

There might even be some backlog in paying outstanding study fees. This type of debt is very common with young ladies (and men) and can easily be 1K Baht or more.

[SOTIRIOS]

....this is where you come in of course....

[recycler]

7 credit-cards and 1 of a friend maxed out plus a personal loan and you still think she's not aware of what she's doing?

They really don't hand them out just like that at banks, there is a credit bureau where they check before you get it and she has to provide documents proving her income etc.

This is not possible without faking and fraud, there may be some more in other ID's too.

I hope you wake up before you get ripped off.

[SOUTHERNSTAR]

I love the credit card laws here in Thailand ,a young lady like this with no money can have 6 credit cards ,but when i asked the bank for one ,(i have quite a lot in this particular bank) so that i could pay for my airfares etc online which i cannot do with a debit card , not a hope , amazing Thailand .

Although I agree in principle with you about the credit cards, you can get a credit card if you put an equal amount into a fixed deposit or you can get an online debit card that allows you to do online transactions (K bank had both options). It is however not easier to get a credit card elsewhere in the world if you aren't at least a resident of that country (try to get one in Singapore or US).

[asdecas]

Boy, you picked a good'un, though on reflection your arrival on the scene was probably serendipitous, if you take my meaning.

If your paramour has no understanding either of the value of money or of personal responsibility, one wonders what future you foresee together?

In order of preference, I'd solve the problem either by:

1. Walking away from the relationship, or

2. Looking into Thai personal bankruptcy laws, or

3. Moving abroad together and never coming back, or

4. Grinning and bearing it together, and suffering years of arguments

[GotSeoul]

There's a great book out there written over 15 years ago called "The Millionaire Next Door" by Thomas Stanley and William Danko.

It's great book that talks about having a good offense (creating wealth) and having a good defense (preserving wealth).

Regardless is aspirations are to be a millionaire or not it's got some great information for anyone to read, understand, and follow.

The piece of information relevant here is that one of the best ways to make sure you preserve wealth is for you and your spouse / loved one to have the same thoughts and ACTIONS on preserving wealth. Their research has shown that this trait in relationships is highly correlated to those that have been able to have a good defense of their wealth creation and live happily into old age on the wealth they have created.

It makes sense. If you and your spouse agree on the same things regarding money, you will be much happier and preserve more wealth than those fighting over the money and/or spending it away to avoid problems. Money is one in the top 3 reasons couples are unhappy and separate.

I say all this because a decade ago I went through this. If you don't want to have to work into old age, make sure you and your loved one are aligned. I had to let that one go, I was going to have to work until I died if I stuck around with her.

Edited February 3, 2016 by GotSeoul