What is a 341 Meeting of Creditors?
If you have already filed for chapter 7 relief or you are considering doing so, then you should be aware that you will be required to go to the bankruptcy court and attend a Section 341 Meeting of Creditors.
In every bankruptcy case, regardless of whether it is Chapter 7 or Chapter 13, there is always a 341 Meeting of Creditors. This meeting, often referred to as a 341 hearing, is not held in a courtroom. There will be no judge. It usually takes place in a meeting room, presided over by a trustee, appointed by the Office of the United States Trustee (a Government Agency which oversees all bankruptcies in the USA), approximately one month after a case is filed. Although it not held in a court room, 341 meetings are nonetheless legal proceedings, and anyone who is examined or questioned, will be under oath.
That being said, a 341 meeting of creditors is a rather informal affair, and should not be cause for concern.
Here are some of the questions you might have.
What is the Trustee’s role in the Meeting of Creditors?
Filing for bankruptcy in New York or Long Island, under Chapter 7 or Chapter 13, means, that in both cases, a court-appointed trustee will play an important part on your case. Although the trustee is required to treat a debtor in a fair manner, you should not consider them as “part of your team”, as they may not be acting in the your best interests.
At the meeting, the trustee’s role is to ask questions about the statements submitted in the bankruptcy filing, which must be answered truthfully, since you are under oath, or your case may be dismissed, and more serious penalties could be imposed.
What to Expect at the 341 Hearing
Prior to the 341 creditor meeting, the trustee will go over your paperwork to ensure your identity is authentic, your finances have been recorded accurately, and you have not committed the offence of bankruptcy fraud.
At the meeting you must provide a photo ID and confirmation of your Social Security number.
The meeting starts with the trustee asking questions, which cover straightforward issues, including whether all of your property has been listed on the petition, whether or not your situation has changed since filing your application, and if you are owed any money or if you are expecting to receive a bequest of some kind. Although it is unusual for any creditors to actually attend the meeting, if any do, they are permitted to ask questions after the trustee has finished.
Preparing for the Creditors Meeting
Once you are satisfied that you have prepared everything needed for the creditor meeting, make sure you take a written note of your assigned date on your calendar. The court will send you an official notification of when and where the meeting will take place, and you cannot afford to miss it. The courts in New York and Long Island take a very dim view of debtors missing their hearings. If you do, the trustee may re-schedule, or in the worst case, request the court to dismiss the case.
What You Should Bring to the 341 Meeting of Creditors
At the very minimum, U.S. bankruptcy law requires you to send a copy of your latest tax return(s) to the trustee at least a week before the meeting. Make copies of bank statements, pay stubs, mortgage documents, any real estate deeds, insurance documents, and car titles to take with you. Your bankruptcy filing paperwork probably has all these documents already, but better to be prepared for the unexpected.
You must bring with you:
• picture ID,
• proof of your Social Security number.
You can also bring a record of any non-exempt assets, such as real estate which is not your primary residence, investments not held in a retirement account, artwork, or jewelry which can be sold to pay off some or all your debts, although the trustee probably has a record of these already.
The Logistics of the 341 Meeting of Creditors
Trying to park your car near the courthouse might be difficult, unless it is a modern building with a large parking facility. Plan your visit well in advance. Find out where you can park without any problems, and arrive at least 15 to 20 minutes early — just in case.
There could be other trustees conducting hearings at the same time as yours, so you need to make sure you know which room to go to, and in what order the cases will be called.
As we stated earlier, there will be no judge in the room, the trustee will be holding the hearing. Of course, creditors may be there as well, but in the majority of bankruptcy cases, they don’t turn up. You will be sworn in and asked a number of questions under oath. If everything is satisfactory, the meeting will be ended, if not, the trustee will postpone it until a later date. If you have supplied all the necessary documentation, a postponement is a rarity.
How Long Will the 341 Creditors Hearing Last?
There will be several cases scheduled for the same period, so once your name is called by the trustee, things will move along quickly. Once the trustee has asked you some routine questions and inquired about anything that needs further clarification, if there are any of your creditors there, they will ask you questions. On the off chance that a creditor’s questions requires more time to be answered, the trustee will postpone the hearing to another time. In the majority of cases, 341 hearings only last about 10 or 15 minutes.
What Are the Usual Questions Asked at the 341 Meeting of Creditors?
If you have engaged a bankruptcy attorney, then he will go over some of the questions you will be asked, but there are standard questions the trustee should ask every debtor. Basic questions like:
• Confirmation of your name, Social Security Number, and your current address, (which should match your photo ID).
• Are you personally familiar with all the petitions and schedules filed in your bankruptcy case, and if the information is complete and accurate?
• Do you have any alterations to make to your petition?
• Has all your assets and creditors been listed on your forms?
• Have you previously filed for bankruptcy?
In addition to these required questions, you might be asked about:
• Real estate you own.
• Motor vehicles and other personal items.
• Bank accounts and any investment accounts you may have.
• Your last tax returns.
• Your income and present employment status.
• Any property you may have sold or any money you have given to others in the last 12 months. If it is decided a transaction was wrong, it can be reversed and the proceeds taken to satisfy your creditors.
• What you intensions are regarding any secured debts.
• Have you incurred any new charges to any credit cards? If so, when?
• Have any of your creditors received payments from you in the 12 months prior to your bankruptcy?
These are only a sample of the more common questions a trustee might ask, but each case is different, as is each trustee, and your questions may be different.
Do You Have More Questions? Why Not Schedule a Free Bankruptcy Consultation?
If you find yourself reading this blog and are considering filing for Chapter 7 or Chapter 13 bankruptcy protection, but still have additional questions, why not contact us for a free consultation.
Everything we have discussed so far can seem somewhat daunting and cause for concern, but we can help you get through the whole process with little to no worries.