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Does debt/bankruptcy affect my ability to live and work in Japan? - 09-26-2014, 08:50 PM

I am currently in the process of applying for a work visa in Japan. However, I have a lot of unpaid debt to places in America (mostly hospitals) for matters beyond my control. I have been trying to pay these debts for years, but the many of the companies are not willing to negotiate payment plans very much. I am considering bankruptcy, but haven't decided yet. I am also planning to try to find a better paying job for the time being.

My question is, if I do apply for bankruptcy, will that prevent me from entering and working and residing in Japan? I have some money, just not enough to pay all my debts, so I could still pay to go to Japan and all if I get this visa.

Or, if I don't do bankruptcy, but continue to try to earn money to pay off the debts as much as possible, will I be allowed to enter and work in Japan even though I have a lot of debt in America? And would it possible to America to force me to return against my will because of the debt?

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Sangetsu (Offline)
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09-27-2014, 01:00 AM

Having these debts will not affect your coming to Japan. The only debts which can prevent you from leaving America are those debts which prevent you from getting a passport, like unpaid child support, or a large amount of unpaid taxes. If you are eligible for a passport, then you are eligible to work in Japan. Unlike American companies, Japanese companies are forbidden by law to perform background/credit checks on job candidates, which is one of the reasons why they prefer to hire people who are straight out of university, and who haven't had time to get into trouble.

I used to be a credit specialist in America, and I will give you some advice on how to handle your current debts.

Firstly, your American credit record is 7 years long, so any debts on your credit report will disappear after 7 years without you doing anything at all. You should ignore these debts, and do nothing at all about them. The reason why is that if you do pay them, the last date of account activity will be moved to the date you made the last payment. Having a "paid" delinquent or collection account is no better than having an "unpaid" one, so even though these accounts have been paid, they are still negative information, and you will have to wait 7 years for these paid negative accounts to fall off.

A bankruptcy will remain on your credit report for 12 years. The only time you should ever consider bankruptcy is when your debts are large enough that your creditors may try to sue you in court to get a judgment against you. Judgments can remain on your credit report indefinitely (much longer than 12 years) if your creditor/state continues to renew them.

Unpaid hospital debts are not as bad as other types of debts, because they are involuntary. If I borrow money from a bank, or use a credit card, I have to agree in writing to repay the money according to the terms in the contract. For medical bills there is no such contract. But even unpaid bank loans or credit cards will not result in your being turned down for a passport, nor will a judgment or bankruptcy. Hospitals seldom go to the expense to sue to collect money owed them, they simply write off the unpaid bills and as an operational loss.

I have written a book on how to deal with credit problems, so I have a little expertise on the subject. Let me know if you have any other questions.
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