Although I have written about this in the past, I am revisiting the topic of debtors who have fled the United States as a direct result of being hopelessly in debt. I am in the midst of trying to help some folks become permanent expats as a result of crushing debt, but I need your help. Many of them would like to know what it is like to live abroad as a permanently indentured educated individual. Your stories would be appreciated. Indeed, if you could provide them with some hope about how you are faring outside of the United States, you might just save a life. More debtors are becoming suicidal, so we'd like to know what it is like to be in default and yet be outside of this country. How are you doing? What is your day-to-day life like? Is it better than here? Would you recommend leaving the US? What are the challenges? What are the benefits?
Thank you for sharing.
Nobody is becoming suicidal. There is always IBR at worst case. Or really, just default and laugh, it's an unsecured debt.
The only reason to worry is if you actually care about credit and following the "American dream" which really doesn't even exist anymore anyway.
I paid my debts off because I figure it's just easier to get them paid off and then just not worry about anything. The US has a really high QOL, and most countries actually close their borders so it's very hard to just go somewhere else.
If I had a choice, I'd get EU citizenship, but they don't give those away.
Most people I know just ignore their debt, maybe pay minimums, and just enjoy life. I didn't do that, I worked my ass off and paid it all down. If you keep expenses low, most can pay it off, but most people refuse to cut their expenses.
Someone that is legitimately unemployed or totally broke won't have expenses in the first place, they're forced to cut to the bare minimum to survive. Loans won't even register then, if your choice is to pay the loans or not eat, nobody is going to pay the loans. But the IBR payment will be $0 in that case.
This is why pretty much nobody is going to flee the US because of student loan debt. It doesn't make any sense.
I don't normally recommend JD Underground, but I'd suggest people inquire there due to the likelihood they'll get useful information.
@PresTTige - would you mind sharing over there?
is there an email i can contact you with info?
I tend to gravitate more toward the other extreme: if they ever bailout the student loan debtors, I will - without question - move out of the country and stop paying taxes altogether.
Yes. My email is ccrynjohannsen AT gmail DOT com.
@Anonymous 10:13 PM - I think it would be great if people like you would leave. Good riddance to the cold-hearted! Stop trolling my page.
I posted a comment that you didn't put up, but I am not @10:13.
Why should those of us that busted our asses and paid taxes just get screwed over? Why is it cold hearted when we want fairness in our dealings, and don't want to be put in worse positions for busting our asses and doing things the right way?
From my point of view, you are being cold-hearted, and accusing people of trolling for pointing this out is childish.
How about the government gives those of us that paid our student loans a refund? That would be the only fair way to do it. I'd love $150k tax free, inflation and interest adjusted, that would go a long way to putting me in a fair position. That would be the fair way to do it, those that paid get a refund, those that didn't get loan forgiveness. No net loss to one party at the expense of another.
Ah, I see you have met Gribble, the Baby Boomer, and notoriously ignorant troll, droning on about how he pays taxes (so does everyone else).
He is, of course, objectively wrong and a blathering fool. He paid nothing.
Prior to 2010, student loans were made with privately raised capital not taxpayer money. Since 2010, the federal government has borrowed the money it lent to students in the form of US bonds. No taxpayer paid for these loans.
He also had bankruptcy protection and being very old his loans well pre-dated tuition inflation.
So, dear moron, Boomer, Gribble, the fact that you *could* and *allegedly did* repay some trifling amount on a private loan is neither an argument against student loan forgiveness nor a moral virtue on your part.
Your generation stole unbelievable amounts of money from the younger generations. You are thieves. You have no moral rectitude. You designed tuition inflation for your benefit. Go to hell.
You are my hero!
I'm 32 years old, and paid $150k plus off for my "legal education."
yadroc is a lazy troll that doesn't want to work and wants to scream that everyone is a Boomer out to get him. He tried working once, but then he decided he "didn't like it" so "why should he have to?"
I would suggest lemmings don't tie their hopes to the yadroc the deranged train.
yadroc won't even use his name on these comments, but everyone knows it is him. Unlike yadroc, my dear fellow scam victims, you probably will have to support yourself, the same way I did, so you can't sit around at home refusing to work.
Yes it's tough, you'll have to work really hard to make ends meet, and you will get treated like shit and feel trapped. But that is life for most of us that don't have rich parents to live off of. Better to do what you can and get that burden off of your head. It's not healthy to sit there and insist 32 year olds you meet on the internet are evil Boomers that have been plotting to destroy you while you were in the cradle.
But there is light at the end of the tunnel. I promise you this, you are smart enough to get yourself out of the mess you're in now, as long as you're willing to put your ego aside and work.
Cryn, I tried to ignore the troll but I felt I should respond because I don't want people to sit there and become defeatist. It is always a bad idea to give people the message that they are helpless victims and their efforts won't yield fruit. A person's effort is better spent in trying to help themselves rather than attacking others or begging for someone (the government) to come save them.
As I stated before, I do not see many people leaving the country to flee those debts, they either go insane like yadroc or they pay it off like me, or they ignore it on IBR like many of my friends did. But most people do get it under control after awhile. I suspect you won't find examples of people leaving the country, instead you will see yadroc rants insisting that they shouldn't have debt and shouldn't have to work, but anyone that is rational knows they have to work.
Cryn, have you actually received any stories of people leaving to escape their debt? I am really curious about it.
Ah yes, good old gribble. Banned from other websites and now preaching here. Your message is old.
Gribble of course will tell us his real name?
But well this is an older article, but I guess it shows the topic of leaving the US because of the removal of consumer bankruptcy protections for student debt is not all that new:
Here is another discussion:
I typed out a really long and detailed reply. I exceeded the character limit. I am a US expat who is a "student loan debt fugitive." There are many of us here in the EU.
If anyone wants the full text of what I typed. let me know your email or something. but here is a small piece of my total comment:
I am living outside the country with US student debt. I won't bore you all with my story, but the end game is I cannot possibly pay it back. Even if I were to enter IBR the amount forgiven would be equal to hitting the lottery and having to pay taxes on that amount would be insurmountable. In my not always humble opinion IBR is a political scam to basically kick the can down the road without actually forgiving debt. What it does is turn a civil debt into a criminal tax liability.
Anyway, it is pretty obvious I am in default. I graduated 3 years ago and my roughly monthly net pay was not going to pay my medical school loan. I attempted to contact my creditors and work out a plan and both the federal and private lenders basically told me I could get a short term relief, but there was no solution for more than a year. They also straight out told me they had absolutely no incentive to negotiate because "they would get their money one way or another."
The country I am in does discharge student loans in bankruptcy. In fact, a judge can declare you bankrupt on the spot. My estimated monthly student loan payment is more than 3 times a doctor's gross salary here. No court here would accept the amounts and penalties the US imposes. In fact, the law here has its own ideas what is an acceptable penalty and they do not include collection or attorney fees. The interest is modest at 6%. So when my creditors called I simply said "sue me!" (I may have mentioned that any lawsuit must be in the native language and filled out in the requirements of the local law.) The reality is nobody in their right mind from the US would sue me here. They would pay enormous fees for translation and local legal aid, to watch me be declared insolvent on the first court appearance. The statute of limitations for suing over debt here is 3 years anyway, so in a few months I could just claim that.
I actually encourage people, if you can't pay your US student loans, pack up and move. I think it is foolish not to. Sometimes I feel bad about not being able to pay the money back, but I suspect just like homesickness, it will fade with time.
I know that lenders, the government, or private, have absolutely no remorse about any immorality they subject me or my family to. They created laws to benefit them. I moved somewhere that the laws benefit me. They are more than welcome to call and negotiate a reasonable settlement. But I suspect they really just don't want to bother. Neither of us has any incentive to give concessions to the other. I keep hearing that my life would be destroyed if I moved back to the US. But honestly... Move back to what? Difficulty renting a place to live? Difficulty getting a job because of student loan default? Pay garnishments? Shame? Not getting my drivers' license renewed? Not being able to have a professional license? Harassed non-stop by creditors? Give up my legal advantage? A lower quality of life and more expenses for my family?
That is insanity. Why would anyone go back to that?
@Anon 927 may I repost your comment as a blog entry?
Anonymous in EU,
How did you obtain membership in another country? My husband and I semi-jokingly looked into this and we found that most countries require an outrageously high balance in one's checking account, along with a multitude of other impossible hoops through which one must jump. Seeing as how we're all penniless, how did you do this?
Since you are a troll, my story will not matter to you but for the record, I have repaid $75K on a $60K loan and I still owe over $55K. I have more than repaid my obligation with interest, and I apparently have another 20 years to go on it. I am getting sick and tired of everyone thinking that a student debt jubilee means that every self-righteous asshole out there is somehow absorbing the cost of "my" choices. I repaid my alleged debt and it's still hanging over my head. I pay taxes, too. If you want to be angry, join us in our cause against those who have bound us in shackles. Hold them accountable. Demand the same consumer protections that everyone else in this country enjoys. If you release 40 million hard-working, educated, eager people from financial prison, I guarantee the real estate market, the auto industry and just about every other sector will take off in a positive direction and we will see our nation recover from this recession seemingly overnight. Let us spend money - let us put our dollars into the system rather than feeding megalodon, bottomless pit banks for 30+ years. Keep us tied down, and you will witness the fall of America.
My story is a bit unique, but there are others here that have gone different paths. We have a social group. I was in a long term relationship with a foreign national and when we got married. Her country offered better opportunity. So we basically "went home."
There is one guy here locally, who went to Slovakia on a visitor visa and asked for and got asylum based on his debt situation. He says for evidence of persecution he used several websites detailing student loan default consequences as well as the the DoE website. Many of us also saw that IBR would eventually lead to criminal tax charges, so that can be leveraged as well. One of the girls here came on a automatic 90 day visitor visa with her passport and applied for a job teaching English. (Being a native speaker and teaching English is the most common path to employment. Not just from the US, but also Brits, Aussies, and New Zealanders do it.)
All of the people I know were (un)fortunate enough to realize their default was inevitable, so rather than make minimum interest payments, they saved the money and went "all in" to leave the country. Most of us, including me, simply couldn't afford to return when we first got here.
The most important thing is to not pick a top tier nation to start in. Forget Germany, UK, France, etc. You need to go to Italy, Poland, Spain, Slovakia, Estonia, etc. The "newer" and "second tier" members. Their entry requirements are much less. Plus there are basically no social safety net services you can live on. Your money also goes a lot further in those places. For example, I think Poland is one of the best, because they still use Zloty instead of Euro. It trades roughly 3:1 for the dollar, and the cost of living is really low. The language is really hard though.
I think it is ideal to show up with about $5K in your pocket. I have seen people do it with as little as $2K, but they really suffered. Some get help from family, but I did not have that option.
Expect you will have to learn a new language. Expect that it will be extraordinarily stressful. It helps to connect with other expats early. You will need experienced help doing simple things like reading, talking, finding a place to live, etc. You don't just show up and move into the high rent district.
After a couple years of struggling to get by, getting the permanent residency card is the goal. Once you have it in any EU nation, you can move and work throughout. Then you can spend a couple of years saving enough to go to one of the first tier countries and start a normal life. I am just getting to that point now.
I can tell you it is not an easy choice. You certainly just don't show up and have a "normal" life. But what you have is the opportunity for a normal life. I don't know anyone who has failed, because like I said, it was basically the last ditch effort for everyone here. It had to succeed, because there was not enough money to even get home. There are people here from all over, Australia, Nigeria, the US, Pakistan, Vietnam, et al. It is old school emigration.
Ultimately the goal is to renounce US citizenship and basically be off the US grid and live happily ever after. But in order to do that, you need a new citizenship, not just residency. Most places that takes 5 or more years. The only shortcut I know is marriage.
Something very important, none of us had any loan cosigners or assets. So there is nothing left in the States to go after. We jokingly call this "The Edward Snowden loan forgiveness plan."
Incidentally, I looked through the links provided and I offer fair warning, there is a considerable amount of misinformation in them. They are not even worth reading.
I have also written about this in the past and know many who have fled.
Normally I do not comment on these threads, I just occasionally do a web search to make sure none of the legalities have changed. But your post seemed sincere and I felt compelled to help, especially since things really started to look up after what has been a few stressful years.
The other day a friend of mine (an expat) and I were having dinner and we were very happy we made it to the point we could actually give up our US citizenship without worry or regret. We marveled at our adventures and the idea we never once thought "One day I will get more benefit not being a US citizen than if I was." Who wakes up and says that?
You have my email, so if I can be of further assistance, just let me know.
I cannot believe that US citizens are so persecuted in our own country that some of us are fleeing due to financial persecution. Thank you for pointing out that IBR only ends in a criminal tax liability. Every time someone says, "Yeah, but you have IBR!" I always try to explain why IBR is more dangerous than regular default. Of course, it's so absurd that nobody ever believes the truth.
We just applied for a $1,000 loan to help us get through the summer (one of us teaches adjunct on the side and we don't have that extra job May-August). We were declined... this is because there is a new law that creditors now have to take into account student loan debt that is in deferment (our federal loans are in deferment and our private loans are in repayment). They must now treat all student debt as if it were in full repayment.
We tried to buy a very modest house in January (our payment would have been less than our rent). Thanks to this new law, we were denied the mortgage. In the past, banks did not have to count deferred student loan debt but as of January, they do. So, basically, we're all screwed. You can't buy a house or most decent cars in this country without a loan (especially when it is virtually impossible to save money thanks to high student loan payments).
For the first time, I literally have no answers. What are we supposed to do now? We're completely locked... but that was the plan all along, wasn't it?
Meanwhile, our politicians are patting themselves on the backs for pushing debt-free college. Wonderful. I'm so excited to have my taxes raised so that I have to pay for MY education for the rest of my life as well as future generations. Don't get me wrong, I'll happily pay for theirs if I could get my own debt off of my back but it doesn't look like that's going to happen anytime soon. I'm not thrilled about having even less money for food. :-(
This is not where I thought I'd be when I turned 32. I never cared to be rich but I didn't expect to be in bondage, either.
I'd like to add the following...
I have spoken to a number of attorneys about my situation (costing me more than I had). I was told about a little dirty game that creditors like to play.
Say you default. A creditor (especially for private loans) will probably take you to court. However, they will intentionally send a summons to an old address (even though they know your current address). They'll leave it on the door (which is somehow a legal way to notify you of a court date) rather than sending the notice through the U.S. mail so that it could be forwarded to you. The point of this is to claim that they tried to notify you of the court date, but you failed to show so you were in "contempt of court."
They then return to the court and request that you be arrested, since you were in contempt of court.
This actually happens, according to a highly paid attorney in Maricopa County, Arizona. They actually get you arrested, using taxpayer funded courts, just to be assholes.
Yo, Gribble: You still 32 years old dawg...in 2015?
You are a Boomer, not 32. Keep frontin' and keep votin' Republican.
"gribbleMarch 5, 2013 at 5:50 PM
Hey man, I doubt you remember me, but I was around JDU and posted some comments on your blog a few times 2 years ago or so and much more sporadically more recently (but that works out since it sounds like you didn't post much either!).
You'll probably recall I told you before "How could anyone like this profession?" and instead of challenging you when you talked about how great it was I just stated "I guess there are some people that do really like it."
The reason was I had pretty much been through what you went through by that point, almost exactly on the dot. I am 32 years old myself!...20 years ago the field was a bit better but also it didn't matter as much if you washed out because there was no real price tag on it."
You knew what the legal field was like in 1993, when you were 12 years old? BEAT IT, Old Man Republican Abuser!
There are many tricks that can be used. One is called "service by publication."
Basically if they cannot find you, they can print a docket in a newspaper, because who reads newspapers anymore? Some states allow notification to the last known address. It doesn't matter the techniques they use, the system and laws are designed for you to fail and then penalize your for the rest of your life.
I left the country. Others have. We get the legal protections from the country we are in. That is why most creditors will not pursue overseas. That and their automated software cannot handle the phone and area codes :)
Figure like this, many people left everything they had in their homeland for better opportunity in the US. Now the opportunity is elsewhere. In true American spirit, pack your shit and move. Don't look back.
Student loan debt protection aside, the benefits I have living in the EU are better than anything I ever had in the US.(I consider myself European, not a specific nationality, though I do have a specific passport from a country that has done much for me and my family)My wife had no debt because school here for citizens is free. There is also no community property here. So everything is untouchable in my wife's name. I got my PhD because I was a naturalized citizen, so the same right to education was applied to me. I paid my bills when I first started fixing the English grammar and language of the papers academics were trying to get published in English. I was considered a bargain as I was educated in science and charged less than 1/5th of the going rate. I charged about $200 USD a paper, 8-10 pages. In a couple of instances it was a complete re-write. But all the language schools charge $0.33 a word. It is beyond affordable to the professionals here. Those doctors also tutored me on how to pass my licensing exam in my new language, and gave me unlimited access to labs and reference material. Everyone was a winner.
My own publications from that boosted my career prospects. I am able to actually work in medicine, which actually is very stressful in a non-English speaking country for me.
Like I said, it is not an easy path, but really, if you work at it, not only can it be done, it has been more beneficial than I could ever imagine. Single payer no out of pocket healthcare, subsidized and effective mass transportation (no need of a car or to pay for one, free education for my daughter no matter her course of study, untouchable by creditors state pension. Bankruptcy protection if I ever need it. Food on the table, and 30 days paid vacation a year. Women get 1 year maternity leave at 100% salary and an optional second year at 80% salary plus their original position back.
If the USA is so great, what do you have?
I have written a few pieces about this topic, one of which was published by USA Today several years ago, but back in 2012, I through out the question on here: http://alleducationmatters.blogspot.com/2012/02/fleeing-country-to-avoid-student-loan.html
You don't think the use of mass media to brand people as lazy deadbeats who don't want to pay their bills is political persecution? What do you have to do in order to meet such a burden? I think Vladimir Putin was a bit more eloquent simply calling people a "fifth column." As I said, I know a person first hand who used it as a means to obtain political asylum. But it is fairly straight forward. I most certainly have come to believe that student loans are predatory lending. I admit I didn't always think that way before I realized I physically could not earn the money to pay and the response was "we don't care, we'll get our money." I will never forget being told that. Even the ombudsman at the DoE was dismissive. So much for conflict resolution...
However, as I understand, the IBR tax issue is going to be a problem if it is not changed, and why should it be? The entire point of IBR was basically a political half measure.
As for bragging, I don't consider having to flee as bragging. More like the best choice of a host out of a host of bad ones. But I do admit it has worked out fairly well. I was quite surprised considering for much of the time I was very close to being totally broke with no obvious way to change that in a country I was struggling to even learn the language.
I don't have any surviving relatives in the US, but I didn't just abandon everyone. You might be aware we live in the information age and real time communication is very popular. I even maintain friendships and professional relationships across the entire globe.
I was also surprised to learn more people were exercising the emigration option than is reported. I wonder why that is?
As for heritage, that doesn't feed, cloth, or shelter anyone. So while it is a grand idea, it is not very practical. As well, while nobody has reached the end of the IBR period, many countries have treaties regarding non-payment of taxes with the US. So if you hit that point, you have absolutely no recourse, including fleeing the country. (At least not to any civilized nation outside of Russia or China)
Are you suggesting that Europe doesn't have rock and roll or pop culture? That it doesn't have McDonalds? (Not that I want to eat that crap anyway)I have my coffee from Starbucks, I can go to Pizza Hut or Burger King if I so desire. I haven't seen a BP station here that doesn't have a subway in it.
You can talk about heritage, honor, "the future" as much as you want. But talk is cheap, particularly under the threat that everything from your housing to your job prospects are going to be very realistically curtailed. In states where your Driver's license or professional license can be taken away for inability to pay, your ability to even earn a survivable living is in jeopardy.
Do you think Doctors magically make all kinds of money? Let me put that misconception to rest...
The average reported debt after medical school is $250-300K however, a study by the American Medical Student Association demonstrated that was likely just principle. The average actual debt, supported by multiple sources is closer to $500K. it used to be you could defer payment while in residency training. But that was abolished. The average wage for at least 4 years out of school, working between 80-100 hours a week is 47K/year. So your ability to work multiple jobs is pretty much nothing. At the time I left the states, there was no IBR or ICR. Now if you divide 47k/year by 12, it comes out to pre-tax dollars of $3916.66 a month. My minimum monthly loan payment was just over $1400 a month. That leaves a total of $2516.66 a month for all other expenses, the start of which you can subtract various taxes like social security.
(to be continued because of character limit)
Now lets say your year deferment is up, and with capitalized interest, the very next year, your payments go up to $1500+ a month. Your salary stays the same.
What is the solution? How do you eat? How do you get to work? How do you pay rent and utilities?
Now let's look at a worse case scenario? The year after I finished med school, there were more graduating students than residency spots in the USA. Which means for the people in the year behind me, some of them would end up with no medical job. Go ahead and try to pay $1400+ a month in loans working in a non-medical industry without industry specific education for it.
Have you even looked at the statistics for doctors who default on medical school loans, particularly in the lower paying specialties like family practice, pediatrics, and psychiatry? Basically if you don't get into a highly competitive and high income potential residency (and not everyone will,spots are limited)you face not the possibility, but the likelihood of default. Trade journals are filled with horror stories of doctors defaulting, and I actually personally know several who have. For sure IBR and ICR have probably lowered those numbers. But again, that option was years after my graduating class.
(to continued again)
Sorry, I'm late to the party. I'm considering doing the same and staying in my new country after marriage. My only concern is not being able to visit my family in the States. Were you able to do so and just chose not to? Or are you afraid you would have been detained at the airport or such nonsense?
I moved to Australia 10 years ago when I graduated from medical school. I was over 300k (undergrad + med school) in debt then. I applied for a special skilled migrant visa offered by the government and made my move. I completed my residency, became board-certified and am now a practicing surgeon. I was able to easily apply for permanent residency as a physician and made the move to apply for citizenship 5 years later. I have a family here now and have little desire to ever return to the US. With interest, I suspect my student loan debt is over $500k.
Well, I'm even later to this party, but maybe I can contribute some useful information, too.
Teaching English to non-native speakers (and related tasks such as writing, proofreading...) provides a gateway to establishing yourself abroad. Check out Latin America & Asia. You may need a sponsoring school or institution in Asia or need to do "visa runs" in Latin America, etc., but this can be done. Nobody will care to know anything about your US credit report or student loan status. It's best to have a Bachelor's degree in hand, though sometimes even that's not an absolute necessity. My advice for going this route is to volunteer as an English tutor in the US before looking for work abroad--to gain a bit of free training, some experience and a reference. If possible, take some kind of quick-n-dirty TEFL course on-line or in a developing country where it will be very cheap. This will give you skills & a certificate. If not, don't worry, just get some real-world experience, so you won't feel completely at sea when you face non-native speakers in class.
My personal student loan cross to bear: Thankfully all were government loans, consolidated into one bundle, but the amount owed is now double the principal! A 6-figure sum. Ridiculous collectors fees, interest & penalties, which I don't intend to pay, unless I win a lottery prize or sell a screenplay. Well, not even then. With great riches, I'd pony up the principal.
This doesn't trouble me overmuch because I don't plan to live in the US permanently again. What led me to this point? This--When I first consolidated my loans, my income allowed me to make payments for a little while. Then my job prospects darkened and I started to use up forbearance & other temporary outs.
Just as this was getting dicey, an opportunity arrived to live in a cheaper country with an elderly relative who wanted to stay warm & stay out of nursing homes. (This retiree had access to "Cadillac plan" retirement health insurance accepted worldwide, despite having absolutely no savings or assets of any kind.) I did a lot of research on-line, on Skype, and in the library for about 6 months. Then we scrammed! Before the inevitable occurred, we enjoyed a pleasant & comfortable time.
(No one co-signed my loans, but it would be possible for co-signers and defaulters to escape to another country together, if they get along well enough!)
And by that time, I understood the local scene, the language and culture enough...to pick up English teaching jobs--based on my past experience and a TEFL course I had completed during a spell between jobs years before.
I leave the country every 90 days briefly on runs to maintain my visa status. I had to jump through some hoops to get a Tax ID and a bank account which allow me to have more challenging work. So I don't even have residency. That's living in a gray area, even though I report my income to the local tax office & keep my visa updated.
@Nov 5th - ah, yes! The visa runs. I taught in Korea for a year. I never had to do a visa run, but many of my friends had to do them since they taught there longer than a year.
Teaching in Asia is another good option. I did it as well.
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