Crippled by credit card debt

When Asma and her husband extended piled up more than Dh70,000 in credit card debt to start a business after he lost his job, they knew they were taking a risk.

DUBAI // When Asma and her husband extended piled up more than Dh70,000 (US$19,060) in credit card debt to start a business after he lost his job, they knew they were taking a risk. But that risk quickly turned sour when his business failed to take off and he was arrested for not making payments on his three credit cards.

Asma, 55, who asked that her real name not be used because she did not want people to know her husband had been arrested, is now desperately trying to make a living and repay the debts. She has also become increasingly concerned about the status of her residency visa. She said that after her 56-year-old husband lost his job as a salesman, the family struggled to make the payments on his credit cards, He owed Dh40,000 on one, and Dh14,000 and Dh12,000 on the other two, respectively.

"It was his fault and the bank's fault," Asma said. "Why would you offer a credit line of Dh70,000 to someone who makes only Dh7,000 a month? "And of course it was his fault too but now there is no way out for us. He is in a crowded jail and we don't even know how we will be able to pay back anything if he can't a get a job after this." They also used some of the money from the credit cards to help pay for their only child's university education in India. "We were adamant he have the best education but he persuaded us it was OK to go to the third-best college rather than the top one," Asma said.

Their son, who went to school in Dubai and is studying for a degree in business, had to pay Dh7,536 on top of his annual fees of Dh5,000 to be admitted through the university's non-resident Indian programme. As proof of his non-resident status, his parents had to submit documents including copies of their valid UAE visas. Asma's husband was trying to renew his visa to work at a printing press for half of his previous salary when the banks notified the police about his bounced cheques. He was arrested a short time later.

Last month, Asma reached an agreement with one of the banks that issued the credit cards. It agreed to cut the Dh40,000 debt to Dh32,000 and stop charging interest. She has offered to repay them Dh600 every month. The bank also told her that if her husband had notified them about his redundancy, they could have come to an arrangement without reporting him to the police. "People have offered to take loans on behalf of us, up to Dh14,000 so I may make bail and get him out of prison," Asma said. "But I have learned my lesson. If I don't know how to pay it back, I am not taking a loan."

She makes a meagre living from babysitting, but the income is not steady. She also has to use the money to pay her rent and water and electricity bills. Asma has also managed to pay Dh11,100 towards the fine they incurred for staying in the country with expired visas. Now her son's education is in jeopardy. The paperwork has to be done for him to be able to sit his first-year exams next month, and that means more fees.

"The first month Valley of Love helped us, but I am not sure now from where it is going to happen," she said. [e-mail]