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The short answer is yes, you can move from North Carolina to another state after filing for Raleigh bankruptcy.
We get this question a lot here at Weik Law Office. In fact, there are many valid reasons why you may want to move out of Raleigh right after filing for bankruptcy.
For example, some people move for better job opportunities. Others need to join family members who may be critically ill or need help in some way. It could simply be that you want a fresh start.
Regardless of the reason, you’re free to relocate even if you just filed for Raleigh bankruptcy. However, this freedom also comes with some caveats that can affect your filing.
Bankruptcy Laws are Federal Laws
Because bankruptcy laws are governed by federal law, the major provisions of Chapter 7 and Chapter 13 bankruptcies are largely similar across all states.
There may be some minor variations from state to state regarding exemptions and other matters, but generally speaking, you can file for bankruptcy in any state you choose after meeting residency requirements.
As an example, North Carolina has its own guidelines for exempt and non-exempt property depending on the chapter you file.
So if you file for Chapter 7 bankruptcy in Raleigh NC, you can take advantage of property exemptions such as the $35, 000 homestead exemption, up to $25, 000 in college savings account, up to $2, 000 for tools of your trade, and more.
This can cause some complications if you’re moving to another state with different exemption rules before your case is complete (or even after).
Attorney Weik can help you navigate those potential complexities so that you can focus on the major life changes you’re planning without worrying about your bankruptcy case.
Bankruptcy & Residency Requirements
In the past, too many people tried to abuse the system by moving to another state right before or after filing, so they can keep more of their property if the state has more generous exemptions.
To discourage this practice, the federal government eventually established residency requirements for those who want to file for bankruptcy. Generally speaking, you need to have lived in a state for at least two years before your filing can be covered by the state’s bankruptcy laws.
If you move and file within two years, the court will consider where you lived prior to your move and apply that state’s exemption laws instead.
Basically, this means if you lived in one state for 5 months and then moved across the country and filed for bankruptcy soon after, the court would still consider your home state’s exemptions when reviewing your petition. The rules can change drastically between states, so it’s wise to consult a bankruptcy lawyer in Raleigh well ahead of your move.
Face Your Debt-Free Future with Confidence
Bankruptcy is designed to give you not just freedom from debt, but in other areas of your life as a whole. That includes not restricting your ability to travel in search of a better situation for you and your loved ones.
Whether you’re thinking of moving after filing, worried about wage garnishment, or facing eviction due to debt, Attorney Weik is ready to offer expert assistance.
Call Weik Law Office today at 919-845-7721 for a free consultation, and set up a time to speak with one of our friendly professionals.