Now that a new year has started, many take that as their cue for a new start. For some, this can mean a move to a new location. However, you don’t want to derail your economic situation by complicating an existing or upcoming bankruptcy filing. If you’re moving, or have recently moved and you need bankruptcy protection, then there are key factors to consider that will affect your case.
1. Your relocation destination:
The complexity of your situation will depend on where your new home is located. If you’re moving into another location that is in the same federal court jurisdiction, then it’s as simple as informing the bankruptcy court and the trustee of the change. You may not even have to transfer your case if the new location is nearby. For instance, a move from New Jersey to New York.
However, if your move is to a place of greater distance, then the process requires a lot more considerations, which is the reason that it’s not highly recommended. Transferring your case requires moving the bankruptcy court for a change of venue; you might have to appear in your current bankruptcy judge’s court to explain why moving your case won’t prejudice your case.
2. Waiting period:
If you decide to move your bankruptcy case, there is a waiting period before you can file in your new state. You need to have lived in the new state for a majority of the past 180 days (this means at least 91 days) to file a bankruptcy in that state. No specific documents are required to prove your residency, but you can use documentation, such as your lease or utility bills to verify your time in the state. If your time in the new state isn’t enough to meet the requirements, then you can either wait until the time has passed and file then, or alternatively, you can file in your previous state.
3. Creditors’ meetings:
Attending your creditors meeting may not be an issue. Due to the pandemic, the meetings are generally conducted by phone. Many trustees accept remote connection attendance, but you can execute a power of attorney instrument to allow someone to sub in you for you, if you prefer.
- Exemptions are the laws that dictate what assets you can keep after filing for bankruptcy. When the property is “exempt,” it means it is protected up to a certain amount.
- You shouldn’t sell assets that belong to the bankruptcy estate; this includes any of your prior possessions that are non-exempt, not reaffirmed, or not assumed to belong to the bankruptcy estate for liquidation and distribution. This probably includes your house and any other real estate that you own. If you do indeed sell the bankruptcy estate’s property, the trustee will probably come after you for the proceeds. However, if the trustee files a report of no distribution or abandonment of an asset, then it reverts back to you and you can sell it.
- You probably can’t reap the benefits from your new home state’s exemptions, if they are more generous than your other state; amendments to exemptions usually require you to be in the new state for 730 days.
Get Legal Assistance with New York Bankruptcy Issues
If your case is a New York bankruptcy or will turn into one, it’s obvious that the laws about residency requirements, exemptions, and the way that it intersects with contemplating bankruptcy after relocation can be difficult terrain to navigate. It makes sense to get expert help from a skilled MOWK Law attorney for your bankruptcy needs. Contact us today.