[With apologies to George Gershwin]
You’re living abroad – living the good life in Paris (or stuck somewhere less picturesque). Even whiel living outside of the U.S., you may still be able to take advantage of the benefits and protections of United States Bankruptcy Code. It can be tougher to file, and certain bankruptcy requirements make it more difficult. But, if you are careful, and have a competent attorney, it is possible to file for bankruptcy and free yourself from your U.S. debt.
Reasons to File U.S. Bankruptcy from Abroad
There are plenty of motivations to eliminate U.S. debt while living abroad including: you might be earning a U.S. income, or maybe you intend to return to the U.S. in the future, maybe you own real estate in the U.S., you might have a lot of personal property located in the U.S. (i.e. bank accounts, jewelry, inventory) that could be at risk from debt collectors, or if you have concerns about the impact of the debt on your immigration status in the country you are living.
Even if you are currently living outside of the United States, you are still eligible to file bankruptcy here. To be eligible for bankruptcy in the United States under 11 U.S.C. § 109, you only need to meet one of the following four conditions:
- Reside in the United States; or
- Have property (real estate or personal assets) in the United States; or
- Maintain a domicile in the United States; or
- Maintain a place of business in the United States; or
Filing in California
There are four districts where bankruptcies can be filed in California: Northern, Southern, Eastern, and Central. Even when you are living abroad, your bankruptcy must be filed in the district where you claim to have a residence for the majority of the last 180 days, where you have had a residence, have been domiciled, retained a principal place of business, or Mem>maintained assets. 24 U.S.C. § 1408.
If you have been abroad for more than 180 days, the district where the bankruptcy will be filed is wherever your primary assets are – where you have stored property, or where you maintain a U.S. bank account.
Meeting of Creditors
Traditionally, the biggest obstacle for a foreign resident to filing bankruptcy has been the required attendance at the 341 Meeting of Creditors. All bankruptcy debtors must attend a Meeting of Creditors – usually 6 weeks after filing bankruptcy. This meeting is required in order to receive a discharge. The 341 Meeting gives the Bankruptcy Trustee an opportunity to ask the Debtor straight-forward questions regarding their assets, liabilities, and other matters pertaining to the bankruptcy.
Flying back to the United States to attend a 10 minute hearing is a little cost-prohibitive for most people, let alone someone who is in a condition to file bankruptcy.
However, with the current situation with COVID-19, the shelter-in-place orders, and the ongoing quarantine, the 341 Meeting of Creditors have gone to a teleconference or Zoom format. This is an unexpected advantage to the bankruptcy debtor living abroad. If you act quickly, you could complete your bankruptcy process and avoid any unnecessary travel. If you have a reliable and clear telephone line, there is no longer anything keeping you from completing a bankruptcy while living abroad. Experienced Bankruptcy Attorney In California
Because California’s distinguished wine country, beaches, and state parks do not come without a hefty cost of living, it follows that debts are frequently incurred while living or visiting it for extended periods of time.
Our firm is experienced in bankruptcy filings ranging from the simple to the most-complex filings. Since the COVID-19 situation has appeared, the firm has filed and completed a number of bankruptcies for foreign residents. Our team is experienced and is continually working to make the process as stress-free as possible.
If you are interested in learning more about eliminating your debt while living abroad – please contact us immediately and we will be happy to assist you.