The Debt Panel: 'Can I pay my UAE loan off from my home country?'

The Dubai resident lost their job last year and is planning to return home but owes $5,445 on a personal loan

Requesting a revised payment plan from the bank, with lower monthly instalments, is one way to reduce debt burden. Nick Donaldson / Getty

I have been living in the UAE for the past seven years and lost my job in 2021. I haven’t been able to find another one and my savings are almost gone.

I have cut down on my day-to-day living expenses and moved to cheaper accommodation but my savings will not last forever.

Because of this, I have decided it is time to return to my home country as I will be able to stay with family until I get back on my feet. However, I have a personal loan here and I am worried about what will happen if I leave.

I still owe Dh20,000 ($5,445) but haven’t missed an instalment as I was able to use my savings to pay every month.

I am fully committed to continue paying the loan off, it’s just that I can’t afford to be here any more while I look for a job.

Is it possible to continue paying the loan off from my home country if I leave the UAE? If so, what is required to organise this with my bank? If they don’t agree, will I have a problem leaving the country? JD, Dubai

Debt panellist 1: R Sivaram, executive vice president and head of retail banking products at Emirates NBD

It is unfortunate you are facing this predicament and I empathise with your situation. However, it is commendable you have managed your savings and daily expenses well to ensure you can pay your loan instalments on time.

I would recommend you reach out to your bank and share details of your financial position. Request for a revised payment plan over a longer term that will help you to continue paying off the outstanding, with lower monthly instalments.

Your bank may require supporting documents to assess your request, but considering your good repayment track record, it will most likely be flexible and offer you a mutually acceptable plan.

To avoid future problems, it is important you secure an agreement in writing with the bank for your loan restructuring before leaving the country.

In addition, you should check to see if you have any insurance policies against your existing loan.

Depending on the terms and conditions of your agreement, these policies could cover involuntary loss of employment.

In the event this applies to your case, the insurance could defer your monthly payments for a predetermined period, which would further aid in alleviating your financial burden.

I wish you the best at arriving at a suitable solution and in finding new employment soon.

Debt panellist 2: Carol Glynn, founder of Conscious Finance Coaching

You have done an admirable job keeping up with your debt payments and have now made a sensible decision to move to a cheaper location so you can extend the life of your savings.

It is possible to make the loan repayments from your home country and there are many successful cases where banks have agreed to this.

However, banks can be wary of this kind of situation due to a history of people leaving the UAE without paying back their debt.

They may also be wary as you cannot show them evidence of a source of income in your home country. You will need to show a commitment to continue paying the loan, but the fact you have never missed a payment will strengthen your case.

Try to pay off as much as you can before you leave and have a clear repayment plan in writing for when you return to your home country.

You should also prepare for plan B, in case the bank demands immediate repayment.

Can you pay the loan in full from your savings? Or is it possible to obtain a loan from family members and then you can repay them when you find work in your home country?

Never rely on a verbal arrangement with the bank and ensure you get any agreement in writing before you leave the UAE.

Debt panellist 3: Felicity Glover, personal finance editor at 'The National'

Since the pandemic began two years ago, it has been a difficult time financially for many. You are fortunate to have had savings to fall back on during this time, which have allowed you to continue making payments on your loan.

That is positive for your current situation as your bank will see this in a favourable light. While there is no requirement that you have to reside in the UAE to pay off a loan, some banks may not agree to this as you have no proof of employment in your home country.

That said, it is worth meeting with a representative from your bank to discuss your situation and request to continue paying the loan from your home country. If the bank does agree to this, ensure you get everything in writing.

However, there are a number of other options you can explore to solve your issue.

Firstly, do you have any assets that you could sell to pay off the loan in full, which would allow you to leave the UAE without a financial burden? This could be anything from a car to shares or other investments you may have.

The Dh20,000 that you owe is relatively small — is it possible that a family member could loan you the money until you get back on your feet?

I do understand finding another job has been difficult, but the way we work has been transformed by the pandemic and traditional “brick-and-mortar” jobs are no longer the only option workers have to earn a regular salary.

Working from anywhere has become the norm these days and many companies around the world are looking to hire full or part-time remote workers, regardless of where they live.

This could be anything from graphic design work to accounting and finance, administration roles, technology specialists, software developers and project management, among others.

Some of the more popular remote working websites include Fivrr, FlexJobs, UpWork and We Work Remotely, which are worth checking out for jobs suited to your skills.

If you do choose this option, then it could also mean you don't have to leave the UAE as there are a number of new visas the government has introduced as part of its plans to boost the economy that allow people to work remotely or as a freelancer.

This is certainly worth considering and could open up a new income stream and way of working for you. In the meantime, I wish you the best in finding a workable solution to your problem.

The Debt Panel is a weekly column to help readers tackle their debts more effectively. If you have a question for the panel, write to [e-mail]