Illustration by The National
Illustration by The National

The Debt Panel: 'I have a new job in Saudi Arabia - can I repay my UAE loans from there?'



I have lived in the UAE for almost four years and recently received a better offer to work in Saudi Arabia. However, I still have Dh147,000 left to pay off on two loans – commitments I do not want to run away from. I can easily pay the instalments every month, even if I am not in the UAE, but how do I make this happen? I earn Dh14,000 as an in-flight chef and the new job will pay me Dh16,000. My debts are:

Bank loan 1: Dh28,000 left to pay (monthly payments of Dh3,632 until May 2019)
Bank loan 2: Dh120,000 left to pay (monthly payments of Dh3,852 until October 2021)

Total owed: Dh148,000

I borrowed the money to buy a house in my home country of India. I now need proper guidance on how to leave the UAE with the debts still in place as I have every intention of repaying on time. SH, Abu Dhabi 

Debt Panellist 1: Philip King, head of retail banking at Abu Dhabi Islamic Bank

To maintain a strong relationship with your bank you should be honest and transparent about your situation, explaining that you are moving to Saudi Arabia, where you will be in full-time employment, and have every intention of fulfilling your repayment schedule. You should also share your new employment details and contract with the bank to support your application. However, in many cases, banks will be cautious given that you may abscond and it would be difficult and expensive for them to recover the debt. You should therefore be prepared that they may not agree to your request.

It is therefore best to try and repay the Dh147,000 in full before you leave. Your end of service gratuity should definitely go towards this, as should any funds that you can raise by selling the house that you purchased in your home country, along with other assets such as a car, furniture or any other household items.

In summary, while it is worth having an initial conversation with your bank in which you clearly state your intention, you should be prepared that your application will be rejected.

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Debt panellist 2: Keren Bobker, an independent financial adviser with Holborn Assets

Congratulations on the new job. I am pleased you fully intend to meet your commitments. Compared to many cases we see, the total amount outstanding is not very large and the repayments should easily be manageable on your income.

While banks prefer customers repay loans in full before leaving the UAE, not least because it is harder and more expensive to chase up defaulters outside the county, it is not essential. If either of these loans are with the bank your current salary is paid to, they will receive notification you have left your job and your account will be frozen. Your final payment from your employer, plus any End of Service Gratuity, will then be offset against monies owed leaving you with a reduced debt.

Check the terms of any agreement paid from a salary account as it may contain a clause that states the debt must be paid in full if a monthly salary will cease to be paid.

Given the amount you owe, it is unlikely the banks will  apply to the courts for a travel ban, however it may be in your interest to negotiate with the banks once you have left the UAE. Unfortunately, many people leave the UAE with no intention of repaying what they owe so banks are understandably concerned in situations such as this.

Payments can easily be made from outside the UAE and you will need to make arrangements with the bank to do this. The quicker you deal with this the better, to ensure no payments are missed and the banks remain favourable towards you. If either of these banks has branches in Saudi Arabia, you could ask them transfer the debts to a branch there. I am aware of cases where a bank has allowed this - a better arrangement for all parties.

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Read more:

Start-up will help UAE residents borrow money they can afford to repay

The Debt Panel: Single mother of four is being hounded by debt collectors over Dh43,000

It is possible to restructure debt directly with UAE banks, a Sharjah resident reveals how

A nine-step guide to help you renegotiate bank debts in the UAE

How an Abu Dhabi resident took three UAE banks to court and cleared Dh700,000 debt

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Debt panellist 3: Ambareen Musa, founder and chief executive of Souqalmal.com

Your primary bank may freeze the funds in your account when the final salary is credited. This is done to ensure your ongoing debt commitments are covered in case you were to leave the country without repaying these. The bank can also apply for a travel ban on borrowers if it suspects they are likely to abscond leaving a substantial debt trail behind.

Given this scenario, it is best to keep your lenders in the loop about your plans to relocate. You can submit the job offer letter from the new employer as a sign that you are committed and financially able to keep up with your regular repayments from outside the UAE. However, banks may not always be willing to accept this arrangement, which is why you must be prepared to deal with a demand for immediate settlement.

Here's an approach to consider:  tap into your savings and investments and possibly approach close relatives to lend you money to settle both your loans. You could also use your gratuity to partially settle your loans, or at least the smaller loan. If you cannot gather enough funds this way, you could apply for a home equity release loan (a loan against property) in India using your home as collateral.

Once the loans have been repaid and you have  started working in Saudi Arabia, you can apply for a personal loan and repay your family members as well as replenish your savings/investments to get your finances back on track.

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 pf@thenational.ae

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Engine: Four electric motors, one at each wheel

Power: 579hp

Torque: 859Nm

Transmission: Single-speed automatic

Price: From Dh825,900

On sale: Now

All you need to know about Formula E in Saudi Arabia

What The Saudia Ad Diriyah E-Prix

When Saturday

Where Diriyah in Saudi Arabia

What time Qualifying takes place from 11.50am UAE time through until the Super Pole session, which is due to end at 12.55pm. The race, which will last for 45 minutes, starts at 4.05pm.

Who is competing There are 22 drivers, from 11 teams, on the grid, with each vehicle run solely on electronic power.

THE SPECS – Honda CR-V Touring AWD

Engine: 2.4-litre 4-cylinder

Power: 184hp at 6,400rpm

Torque: 244Nm at 3,900rpm

Transmission: Continuously Variable Transmission (CVT)

0-100kmh in 9.4 seconds

Top speed: 202kmh

Fuel consumption: 6.8L/100km

Price: From Dh122,900

Dhadak

Director: Shashank Khaitan

Starring: Janhvi Kapoor, Ishaan Khattar, Ashutosh Rana

Stars: 3

MATCH INFO

Euro 2020 qualifier

Ukraine 2 (Yaremchuk 06', Yarmolenko 27')

Portugal 1 (Ronaldo 72' pen)

The Light of the Moon

Director: Jessica M Thompson

Starring: Stephanie Beatriz, Michael Stahl-David

Three stars

FIGHT INFO

Men’s 60kg Round 1:

Ahmad Shuja Jamal (AFG) beat Krisada Takhiankliang (THA) - points 
Hyan Aljmyah (SYR) beat Akram Alyminee (YEM) - retired Round 1
Ibrahim Bilal (UAE) beat Bhanu Pratap Pandit (IND) - TKO Round 1

Men’s 71kg Round 1:
Seyed Kaveh Soleyman (IRI) beat Abedel Rahman (JOR) - RSC round 3.
Amine Al Moatassime (UAE) walk over Ritiz Puri (NEP)

The specs: 2019 Haval H6

Price, base: Dh69,900

Engine: 2.0-litre turbocharged four-cylinder

Transmission: Seven-speed automatic

Power: 197hp @ 5,500rpm

Torque: 315Nm @ 2,000rpm

Fuel economy, combined: 7.0L / 100km

Brief scores:

Toss: Sindhis, elected to field first

Pakhtoons 137-6 (10 ov)

Fletcher 68 not out; Cutting 2-14

Sindhis 129-8 (10 ov)

Perera 47; Sohail 2-18

Dubai works towards better air quality by 2021

Dubai is on a mission to record good air quality for 90 per cent of the year – up from 86 per cent annually today – by 2021.

The municipality plans to have seven mobile air-monitoring stations by 2020 to capture more accurate data in hourly and daily trends of pollution.

These will be on the Palm Jumeirah, Al Qusais, Muhaisnah, Rashidiyah, Al Wasl, Al Quoz and Dubai Investment Park.

“It will allow real-time responding for emergency cases,” said Khaldoon Al Daraji, first environment safety officer at the municipality.

“We’re in a good position except for the cases that are out of our hands, such as sandstorms.

“Sandstorms are our main concern because the UAE is just a receiver.

“The hotspots are Iran, Saudi Arabia and southern Iraq, but we’re working hard with the region to reduce the cycle of sandstorm generation.”

Mr Al Daraji said monitoring as it stood covered 47 per cent of Dubai.

There are 12 fixed stations in the emirate, but Dubai also receives information from monitors belonging to other entities.

“There are 25 stations in total,” Mr Al Daraji said.

“We added new technology and equipment used for the first time for the detection of heavy metals.

“A hundred parameters can be detected but we want to expand it to make sure that the data captured can allow a baseline study in some areas to ensure they are well positioned.”