Filing Bankruptcy While Living Abroad
If you’ve accrued debts in the United States and have since relocated
to another country, you might be wondering whether you could file for
bankruptcy and receive a discharge. Although certain challenges might
arise due to unusual circumstances, it could be possible to legally file
for bankruptcy protection while living outside of the United States.
Living and working outside of the United States does not, by itself, preclude
First - Figure Out If Bankruptcy Can Be Avoided
Regardless of whether the bankruptcy
can be filed, it is important to consider whether seeking a bankruptcy discharge
is necessary and prudent under the circumstances. If the borrower does
not earn income or maintain any assets in the U.S., the creditor’s
ability to collect the debt is limited, and if the borrower will not be
residing in the U.S., their exposure is reduced. Filing for bankruptcy
requires careful consideration, as there could be serious consequences
to filing without carefully evaluating all relevant factors.
Oftentimes, the primary intent when a person files for bankruptcy is to
discharge credit card debts and other bills, so that their assets will
be protected from seizure by creditors. In the event the creditor brings
a debt collection lawsuit and obtains a court judgment in New York, they
could seek to collect the judgment through garnishing wages, freezing
bank accounts, and placing liens on real property. If the borrower does
not have garnishable income and doesn’t have a bank account and
real property, then they aren’t exposed to these collection remedies –
which might obviate the need for bankruptcy. Learn
how to avoid bankruptcy.
Reasons Why Someone Would File U.S. Bankruptcy From Abroad
- They earn income in the United States
- They own a house or other real property in the United States
- They maintain assets, such as cash, jewelry, or inventory, in the United States
- They intend on residing in the United States in the future
- They are concerned about the ramifications of their debt impacted them
in their current country of residence
Learn More About Filing Bankruptcy in New York City
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Eligibility for U.S. Bankruptcy While Living Overseas
Under 11 U.S.C. §109, anyone can file for bankruptcy protection in
the United States, so long as you meet one of the following requirements:
- You reside in USA; or
- You maintain a domicile in USA; or
- You maintain a place of business in USA; or
- You have property in USA
In other words, if you don’t live in the United States, and don’t
maintain a domicile or business here, then you must have property in the
U.S. in order to file. For these purposes, property is not necessarily
defined as real estate. Property is an asset. In some districts, having
a bank account might be considered property sufficient for bankruptcy
Can I file Bankruptcy in New York While Abroad?
Under 28 U.S.C. §1408, the bankruptcy must be filed in the district
where, for the majority of the prior 180 day period, the debtor has:
- Resided; or
- Domiciled; or
- Principal place of business; or
- District where assets are possessed.
If you’ve been abroad in excess of 180 days, then we would look to
where your principal assets were in the 180-days prior to that period.
In a situation where a person has lived abroad beyond this time, most
likely the proper district for filing would be wherever the borrower’s
primary assets are.
Qualifying to file bankruptcy in New York does not necessarily mean you
can avail yourself to the New York State exemptions, including the generous
homestead exemptions that could be available for primary residences in NYC.
Special Considerations For Foreign Filing of New York Bankruptcy
An important factor to keep in mind is that if you file for bankruptcy
in NY, you’ll most likely be required to visit New York in order
to attend the
Meeting of the Creditors, and if necessary, attend follow up meetings, hearings, and examinations.
A bankruptcy petitioner is required to cooperate with the Trustee and
answer any required questions before a discharge could be granted.
There are some situations in which a physical appearance at the required
Trustee Meetings may be excused. Examples of situations that may merit
an excuse from appearing include being deployed overseas in the military,
or due to health and medical circumstances. The Court or Trustee would
make this determination.
New York City is renowned as being a melting pot of cultural diversity. While walking
down any major thoroughfare in Brooklyn, Queens, or Manhattan, you may
encounter people from all parts of the globe. Therefore, it is no surprise
that a person who has incurred debts while in New York might seek to discharge
those debts while they are residing abroad.
Avoid unnecessary problems by letting our experienced attorneys guide you
throught the bankruptcy process. Our dedicated team can help you understand
whether you qualify, what will be required, and help identify potential
issues before they become a problem. Furthermore, we can help evaluate
your file to determine whether you may qualify for alternatives to bankruptcy,
such as debt settlement.
With law offices located in Brooklyn, Long Island, and Manhattan, we are
easily accessible across NYC. Let the skilled advocates at the Law Office
of Simon Goldenberg PLLC guide you safely to a financial fresh start.