Question Is it possible to move to a state with good BK laws?

[swampwiz]

I'm not sure how the laws work. Officially I "reside" in Louisiana as I own an unimproved homesite there, but I've been basically homeless since Hurricane Katrina wiped me out. Perhaps since I was the victim of a Federally declared disaster area, I am free to move anywhere I want.

The reason this is important is because I still have some cash now, and I want to plow into a homestead that cannot be taken away (Louisiana has a sucky law that only shields $25K), so I was thinking of Texas or Florida (any others?) By the time I would be going through Chapter 7, I will have gone through all my cash. My plan would be to simply discharge the $120K in unsecured debt and then tap into my 401K and simply live off that, perhaps supplementing that with odd computer programming or other jobs.

As for my so-called career, as an unemployed 40-something without the latest P's & Q's on my resume, it seems that right now I am unemployable, even with a master's in Computer Science, and I will be running out of cash in about 9 months. I just have to realize that the standard of living for scientific folks in this country is in the toilet, and thus I can't support the lifestyle I have been living the last 6 years as unemployed. I plan to spend a lot of time in Eastern Europe where the living is cheap, so my $180K in the 401K would go far (would be $260K if the market got back to where it was.)

[hereforinfo]

Keep in mind that your $180k will by much less after taxes and penalties. What happens when that runs out? What happens when you are too old to work and have nothing saved for retirement?

As for the first question, you have to live in a state for 2 years before you can use that state's exemptions. There may also be requirements for how long you must own your homestead before you can exempt it - in Florida I believe it's 2 years.

[StartingOver08]

The residency rules are here: http://thismatter.com/money/credit/b...uirements.htm#

Florida has great homestead exemption in bankruptcy (unlimited) but all the other exemptions are very, very small. $1000 for auto and virtually no cash exemptions. Check this link for details: http://www.legalconsumer.com/bankrup...law.php?&ST=FL

So if you are going to move to select a 'good' state in which to file, make sure you figure out which exemptions you will need first.

[backtoschool]

I would also add that in states with good homestead exemptions, it usually takes two years to establish domicile there to take advantage of the homestead exemptions.

A good move might be to a state that allows federal exemptions which tend to be more generous than a lot of state exemptions.

[keepmine]

Also, if you move to a new state that has a large homestead exemption, you are capped at $125K equity exemption until you've owned your home for more than 1215 days.

http://doney.net/bkcode/11usc0522.htm

(p)

(1) Except as provided in paragraph (2) of this subsection and sections 544 and 548, as a result of electing under subsection (b)(3)(A) to exempt property under State or local law, a debtor may not exempt any amount of interest that was acquired by the debtor during the 1215-day period preceding the date of the filing of the petition that exceeds in the aggregate $125,000 [$136,875 effective 4-1-07. Adjusted every 3 years by section 104.] in value in--

(A) real or personal property that the debtor or a dependent of the debtor uses as a residence;

(B) a cooperative that owns property that the debtor or a dependent of the debtor uses as a residence;

(C) a burial plot for the debtor or a dependent of the debtor; or

(D) real or personal property that the debtor or dependent of the debtor claims as a homestead.