I’ve been struggling to find an answer to this question and thought the SDMB might have an answer.
In short, I am a US citizen and resident and I bought an investment condo in Portugal a few years ago. I got a mortgage with Banif, a Portuguese/Spanish bank. My statements get internationally mailed to me in Portuguese, etc.
I am debating defaulting on the mortgage and ‘giving back’ the condo to the bank. I know that, were I do this in the US with any loan with a US institution (mortgage, credit card, whatever) my US credit score would be thrashed. Considering I’m a 740+ credit score holder, keeping that credit score is important to me.
Would defaulting on my Portuguese mortgage with Banif affect my US credit score? Any insights are appreciated!
When I moved to the U.S. from Australia about 10 years ago, one of my problems was that at the start I had no credit history (in spite of having an Australian bank account, credit card, and fully paid-off Australian house). So I suspect that anything that happens in Europe unlinked to an American financial institution will be as if it took place in another universe, whether it’s good or bad. But I have no experience on defaulting on mortgages in Portugal.
It may depend on where the debt owner registers the debt. Someone I knew had a fine due to the Australian government, but didn’t pay it because he was returning to the US and not planning on coming back.
He was gobsmacked when the unpaid fine stopped him from getting a car loan several years later.
Something similar happened to an ex-coworker who was deported back to the UK. He didn’t pay his bill for the deportation, and found out when he applied for a mortgage that it had been recognised on his credit history as an unpaid debt.
So it may depend on your credit provider - although it may depend on whether your Portuguese bank thinks that you’re likely to be trying to borrow money in the U.S.
I second Giles’s experience, only from the U.K. If Citibank U.K. does not exchange credit data with Citibank U.S., I think your chances are pretty slim. One helpful way to check would be to ask for a credit report and see if it shows up.
Credit reports use your SSN and foreign people don’t have a SSN on their accounts overseas so that’s one problem they would have transferring data over.
It’s amazing how difficult this information has been to find. I would like to talk to a lawyer, but I’m even having trouble finding a lawyer that knows anything about it!
I have a mortgage in the Czech Republic and there is nothing on my US credit report to indicate that. Even when I looked at buying a home in the US, they said I would be a first time home buyer since anything outside the US did not exist.
One thing to keep in mind is that the information on a credit report comes from subscribers and publically available court data (such as bankruptcies). The only way that credit debt would appear on your report (and be included in your Fico score) is if Banif were subscribers to the bureau’s services. Transunion, Experien and Equifax won’t know anything about the debt unless Banif subscribes to, and sends data to these agencies.
I would pull all three bureaus to see if the debt is listed anywhere on them. If it’s not, then there is some safety in what you propose. Keep in mind though, that many companies practice “negative bureau reporting” in which only delinquincies and defaults are reported and not the existence of the credit relationship itself. In practice this is usually limited to smaller companies and utilities.
Incidently, some companies will subscribe and report to only 1 or 2 of the credit reporting agencies as there is some regional specialization. Smaller companies sometimes won’t subscribe to one that is outside of its typical service area. As a result you will typically find that you have three FICO scores within a few points of each other, since the existing lines and frequency of update differ between them.
Anyway, hope this is helpful. My point of view is as a 20 year veteran of the US financial services sector.
Thanks. I have pulled all three credit reports and haven’t seen this mortgage anywhere. The only mortgage on my credit reports is the mortgage on my primary US residence.