Where to file your personal Bankruptcy

Where to File Your Personal Bankruptcy

Which states are the best when it comes to a personal bankruptcy? Texas and Florida are good bets. They both have virtually unlimited homestead exemptions. This means that you can go through a chapter 7 bankruptcy, ditch all your debts and retain your home no matter it’s cost.

After the bankruptcy is finalized, you’re completely free to sell the place and use the proceeds to start a new life. Many rich people have taken advantage of this loophole - why shouldn’t you?

Ken Lay the former CEO of Enron owns a penthouse condo in Houston Texas. It's current value is around eight million dollars. After he's been prosecuted for his participation in the Enron disaster, if he's forced into bankruptcy he has nothing to worry about. Under Texas law he can retain all of the equity in a home, the only limit being that it is less than 100 acres in size. He can hide behind bankruptcy and when it's all over, emerge to sell his condo and walk away still a millionaire.

Also - Florida is one of the few states that fully protects accumulated retirement funds from the bankruptcy courts. Why do you think O.J. Simpson is free to play golf all day on his football retirement? His advisors have his $25,000 monthly NFL retirement check deposited in an account in, you guessed it, sunny Florida!

If the check had gone to most other states it would have been seized by the courts and given to the Brown family as part of their civil judgment.

If you’ve amassed a sizeable retirement fund over the years or just want to take advantage of the most liberal bankruptcy laws in the country, you might want to chat with a bankruptcy attorney in one of these states. It just might save you a small fortune.

But making an obvious move in order to take advantage of one state's more liberal personal bankruptcy laws might backfire. Always have an excuse for a recent move in mind in case you're asked to prove your reason for moving.

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