OFWs warned against taking out loans in UAE | Global News

OFWs warned against taking out loans in UAE

/ 04:23 AM January 25, 2015

MANILA, Philippines—The Department of Foreign Affairs (DFA) has warned overseas Filipino workers (OFWs) in the United Arab Emirates (UAE) against taking out loans or making credit card charges they may not be able to repay, citing an alarming increase in the number of Filipinos detained in the emirates due to unpaid loans.

In a statement, the DFA said many OFWs were tempted to apply for loans in the UAE for various reasons, one of which is the low interest rates.

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“They however don’t pay much attention to the other charges which appear in the fine print, and the prospect of taking as much as 18 months of one’s salary. Usually, banks require only a certificate of employment to approve a loan application,” it said.

The DFA explained that debt-related cases were extraordinarily difficult to handle in the UAE, especially if the lenders—banks and individuals—had filed criminal or civil cases against the borrowers.

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Once a civil case has been filed against a delinquent borrower, a travel ban is automatically imposed and he or she would be unable to leave the country.

Issuing a bounced check is a criminal offense in the UAE. Lenders usually require borrowers to affix their signature to a blank check as a security measure.

“When the borrower defaults on his or her obligation, the check will bounce and criminal charges would ensue. If the signature on the check is proven original and authentic, the case against the borrower is upheld in court,” it said.

The cases would also apply to the borrower’s comakers and guarantors for the loan, the DFA pointed out.

The DFA told of the cases of two Filipinos who had difficulty leaving Dubai due to unpaid loans.

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TAGS: Loans, ofws, Overseas Filipino workers, United Arab Emirates
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