Why You Should Not Use Your Passport As Loan Collateral

If you have misused your passport privilege by using it as loan collateral, don’t expect the Philippine Embassy or Consulate’s Assistance to Nationals to bail you out.

This is what a domestic helper, Gina, not her real name, found out late last month when she approached the ATN section of the Philippine Consulate General in Hong Kong to seek help in recovering her passport held by lenders.

The ATN promptly refused Gina’s request while it reitarated its calls never to use passports as collaterals and avoid acting as loan guarantors.

The domestic helper sought ATN’s help to recover her passport after it was used as collateral in borrowing HK$15,000 to help pay for the placement fee of two of her friends who have since moved to Canada. The debt soared to HK$25,000 with interest included.

Making things worse for her is that her two friends now working in Canada have failed to pay back the money they loaned from Gina, who claims she is now being pestered by the creditor.

The debt further ballooned to HK$34,000 so Gina had to pay HK$3,500 a month for the past three months.

Vice Consul Alex Vallespin, head of ATN in Hong Kong, was not moved by her tears Gina shed as she recalled her ordeal.

“Gusto ko na pong umuwi dahil malaki na ang nababayaran ko pero lumalaki pa rin ang utang ko, pero paano po, nasa kanya ang passport ko,” Gina complained.

Vallespin told the woman running away from debt was not a good thing to do because that was her obligation.

The ATN noted that debt problems have become a common issue it has to handle, citing similar cases as that of Gina’s.

“Like that woman, she’s trying to use the Consulate to run away from her debt. We’re not issuing travel documents to help people like her flee from their debtors,” Vallespin told Hong Kong-based Filipino newspaper The SUN.

Vallespin said passport issued to Filipinos is property of the Philippine government and should not be used in transactions such as loan collateral. He also observed that some people borrow even if they don’t need the money personally.

“Let’s inculcate in them that if they don’t need to borrow, they shouldn’t borrow. There have been many variations of the story, we’ve seen a lot of cases. But why do they have to borrow?” Vallespin said.