How Moving Affects Bankruptcy

There are reasons why some people end up requiring bankruptcy protection after moving to a new city or state. Due to the nature of bankruptcy laws, moving can be a problem when deciding to file for bankruptcy. However, this does not mean that one could not still file for bankruptcy; the question is where they are required to file their bankruptcy.

Unpacking Your Bags

The basic rule for filing for bankruptcy is that a person must reside in the jurisdiction of the filing for the majority of the last 180 days. In most cases, this means that a person must have lived in their current location for at least 91 days in order to be eligible to file for bankruptcy in that jurisdiction. If a person needs to file for bankruptcy, but has not lived in their current jurisdiction for more than 91 days they will need to file in the jurisdiction where they lived previously.

Bankruptcy exemption laws also impose a residency requirement for filers. The general rule to utilize the bankruptcy exemptions of the state of current residence is that the person must have lived in that state for the last 730 days before fling. Anyone who has recently moved to a new jurisdiction, or has not lived in their current jurisdiction for 730 days, may be required to claim their previous state of residency’s exemptions. However, there are federal bankruptcy exemptions laws that anyone can claim at anytime during the bankruptcy process to avoid these residency requirements.