What Is The 341 Meeting Of Creditors?
July 22, 2020
The 341 meeting of creditors is primarily for the trustee to question the debtor under oath, regarding the paperwork that was filed on their behalf. Any creditors that wish to attend can come to the meeting, and ask the debtor questions under oath. It’s very rare for a creditor to show up, though they are invited. Notices are sent out to all parties involved in either a Chapter 7, Chapter 13, or Chapter 11 bankruptcy. Judges do not attend. If the trustee wants amendments made after the meeting, we take that information and make the necessary amendments.
DOES THE 341 MEETING OF CREDITORS TAKE PLACE FOR ALL TYPES OF BANKRUPTCIES?
A 341 meeting of creditors takes place for all types of bankruptcies—Chapter 7, Chapter 13, and Chapter 11. The meeting for a Chapter 11 is a bit more extensive, because it’s a business bankruptcy.
DOES SOMEONE HAVE TO COMPLETE MANDATORY BANKRUPTCY CLASSES PRIOR TO THE 341 MEETING?
Yes. These classes called credit counseling must be completed before a case is filed. Credit counseling is generally completed over the internet. The charge is about $10. Credit counseling is usually not required for Chapter 11 cases.
After the case is filed and before the case is closed there is a second class. This class is called a Debtor’s Education class. Generally the class is over the internet. The cost is about $10 to $20.
CAN YOU WALK ME THROUGH THE PROCESS OF THE 341 MEETING OF CREDITORS?
At a Chapter 7 meeting, the trustees have about 10 questions that they ask the debtor. They put the debtor under oath, they verify their Social Security cards and their addresses on their IDs. The purpose of the meeting is to ensure that the debtor has sat down with their attorney, gone over their paperwork, and have the debtors actually sign the paperwork. Normally, the debtor is shown a copy of their signature on their petition, and they’ll verify whether they signed it or not. Then it goes to questions targeting what is in the debtor’s schedule. Primarily, creditors will ask if the debtors have any real estate, the value of the real estate when they purchased it, and how they came to that value.
The second part would be about the debtor’s personal property. Examples of such questions are “Do you have a car? Is there a lien on the car? What do you intend on doing with the car? What do you intend on doing with any property you own? Are you working? Where do you work?” They verify where you work, and any specific issues that might come up on a petition that the trustee may have a question about. The trustee’s main function is to determine whether there are any assets that are not protected by any statute or state law, what we call exemptions. If the trustee sees that there are some assets, then the trustee will open the estate. That is very rare, because most people don’t have a lot of property that is not protected by the law.
Once that happens the trustee will probably ask if the debtor is involved in any lawsuits. The purpose of these questions is to discover if the debtor is expecting to get an inheritance or lump sum of money in the next six months. The meetings take about 5 to 7 minutes for a Chapter 7. Then, the trustee will determine whether there are assets or no assets, and then they’ll file the appropriate paperwork after the hearing.
For a Chapter 13, the role of the trustee is the same—to determine that the paperwork filed matches what the debtor is going to testify to. The Chapter 13 trustee’s role is also to determine whether the debtor has presented a feasible plan for repayment to their creditors. They tend to ask all the same questions that a Chapter 7 trustee may ask. However, they may ask more specific questions about the debtor’s income coming into the household, and whether they proposed a feasible plan.
AT WHAT POINT DURING THE BANKRUPTCY PROCESS DOES THE 341 MEETING ACTUALLY TAKE PLACE?
The 341 meeting takes place 20 to 40 days after the case is filed.
WHO ALL WILL BE PRESENT AT THE 341 MEETING OF CREDITORS?
The trustee, you attorney, the debtor or debtors, and possibly an interpreter if the person doesn’t speak English or understand the questions, will be present at the 341 meeting.
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