Can Debt (Credit Card/Personal Loans) in the UK Affect My Visa Application When Coming Back to the UK?

Whether we like it or not, debt in some form is a reality for a vast majority of people. According to the Money Charity, the average total debt per UK household is £62,706 (including mortgages), and the average credit card debt per household as of June 2021 is £2,022. We often receive enquiries from prospective migrants to the UK who are concerned that outstanding debts from previous periods in the UK may jeopardise their chance of acquiring a visa. In this article, we will explain the implications of debt (including credit cards and personal loans) on visa applications.

Can credit card or personal loan debt affect my visa application?

No, if you have outstanding debts in the form of credit cards or personal loans, there is no reason for this alone to negatively affect your visa application. However, there are some considerations you may need to bear in mind. Firstly, in order to make a successful application for a visa, the eligibility rules may state that you need to have sufficient funds to support yourself and your dependents while in the UK. It is fine that you have outstanding debts as long as you have sufficient money in your bank to meet this requirement. For example, to secure a student visa, the rules state, “You’ll need to show you have enough money to support yourself - unless you’ve been in the UK with a valid visa for at least 12 months on the date of your application. How much money you need depends on where you will be studying. You’ll need either: £1,334 per month (for up to 9 months) for courses in London or £1,023 per month (for up to 9 months) for courses outside London”.

A related rule is the adequate maintenance requirement for UK family visas. Applicants have to show they have enough monthly income to support their families. When making a decision on a family visa, the UKVI case officer is required to calculate whether there are adequate maintenance funds by using a formula that takes into account income and housing costs. Personal debt does not affect this calculation, however. The guidance explains, “Personal debt, including loans and credit card debt, should not be taken into account in this assessment. Only the weekly housing costs are deducted from the weekly net income”.

Can NHS debts affect my visa application?

There are a set of general grounds for refusal which apply to all applications for entry clearance, leave to enter, or variation of leave to enter or remain in the UK. These are outlined in the Immigration Rules part 9 (grounds for refusal), which states, “Suitability requirements apply to all routes and must be met in addition to validity and eligibility requirements”. Paragraph 9.11.1 includes a specific rule covering debts owed to the NHS; “9.11.1. An application for entry clearance, permission to enter or permission to stay may be refused where a relevant NHS body has notified the Secretary of State that the applicant has failed to pay charges under relevant NHS regulations on charges to overseas visitors and the outstanding charges have a total value of at least £500”. As such, if you owe a debt of more than £500 to the NHS from a previous visit to the UK, this may potentially jeopardise your visa application. In this case, we recommend ensuring that any such debt is cleared and a receipt of payment is received before you proceed with an application for a new visa.

Applications for citizenship can also be negatively affected by NHS debt as the rules on good character (a key requirement for citizenship in the UK) states, “A person will not normally be considered to be of good character if they have outstanding debts to the NHS in accordance with the relevant NHS regulations on charges to overseas visitors”.

Can personal debt affect citizenship applications in the UK?

The rules on ‘good character’ (a key requirement for UK citizenship) have quite a lot to say on the matter of debt. As we have established, NHS debt can lead to citizenship refusal, but debt, in general, should not, as long as those debts are being paid off. The good character rules on ‘financial soundness’ state, “An application will not normally be refused simply because the person is in debt, especially if loan repayments have been made as agreed or if acceptable efforts are being made to pay off accumulated debts. However, where a person deliberately and recklessly builds up debts, and there is no evidence of a serious intention to pay them off, the application will normally be refused”. Hence, debts that are not being paid off do risk posing a barrier to securing citizenship in the UK.

Another consideration is bankruptcy. In some cases, bankruptcy may lead to refusal of citizenship on the ground of lack of ‘good character’, but not if:

• the bankruptcy order has been annulled
• the person was discharged at least ten years ago
• the person was declared bankrupt abroad
• the person was involved with a company that was liquidated over ten years ago

Even if the above does not apply, then it is still possible to gain citizenship depending on the circumstances of the bankruptcy. UKVI case officers are required to take into account several factors, including:

• the scale of the bankruptcy or liquidation
• the economic circumstances at the time of application when looking at any mitigating circumstances
• how culpable the person was in either becoming bankrupt or their involvement in the company that went into liquidation

Final words

Debt in some forms can impact immigration applications, but credit card and loan debt that is being repaid should not have an impact. If you are concerned that you have a background of debt in any form which may jeopardise your application for a visa, Indefinite Leave to Remain, or citizenship, it is advisable to speak to an immigration solicitor who can assess your situation before you submit your case. Where possible, an immigration solicitor will be able to help to overcome any possible grounds for refusal and ensure that enough supporting documentation is provided to make sure your application is approved.