Preparing for the Meeting of Creditors
Regardless of the chapter under which a petition is filed, every debtor will have to go to court. However, in order to avoid any bias the judge is not allowed to attend so, the chapter 13 bankruptcy meeting of creditors and other chapters of bankruptcy meetings are not really 'court', but rather a meeting held at court when you file bankruptcy.
The debtor must attend, and the meeting is presided over by the trustee (appointed by the U.S. trustee to oversee the bankruptcy case.) The majority of creditors generally do not attend, even though they are invited. Usually creditors attend the meeting if they have security interests in the case, or if they suspect there has been some kind of fraud in relation to obtaining the credit.
What happens at the meeting?
The trustee may have twenty or even thirty other cases to deal with on the day so in the majority of cases, the meeting is short and uneventful. Nevertheless, most debtors are understandably nervous about the process, despite the fact that trustees often ask the same or very similar questions to a large number of debtors.
It is important to remember that this meeting (often called a 341 meeting) is not like a ‘trial’ to determine someone’s guilt or financial irresponsibility. It is merely to establish the facts surrounding the debtor’s bankruptcy petition. This means that there will be no questions about how the debtor ended up in financial difficulties, or what went wrong along the way. Trustees will usually ask specific questions only if there is a very high amount of debt. However, their aim is simply to try to remedy the situation rather than to pick over the history of the debtor’s choices. Once the debtor is sworn in the trustee asks questions. The meeting is recorded either on tape or by a court reporter.
What kinds of questions do they ask?
After swearing the oath, debtors are asked to confirm their name and address as well as their social security number. The trustee also asks the debtor to confirm that he or she had an opportunity to see the petition and the schedules before signing them. Then the trustee asks the debtor(s) about the contents of the schedules filed with the petition, and whether there have been any material changes to their circumstances since filing. Debtors then have to give information about what they own as well as what they owe, as well as their income.
Sometimes, in the course of the questioning, the trustee may decide they need more information about a specific aspect of the case, which means that there will be another meeting date fixed in the future. On other occasions creditors can apply for the debtor to return to court for more questions. It is also important to remember that creditors can still challenge the discharge even if they do not attend the meeting.
To help to put you at ease about this process, a bankruptcy attorney will discuss in detail with you the questions that will be asked during your meeting of creditors.