Although there are other ways to file for bankruptcy, they all share the 341 meeting of creditors in Springfield Massachusetts. In this conference, as described in 11 USC Section 341 of the US Bankruptcy Code, debtors must provide information regarding their debts and financial situation. While they don’t usually show up, creditors are informed of this meeting and are welcome to attend to inquire about a debtor’s bankruptcy case.
It’s crucial to be ready for your 341 meeting of creditors because the outcome will greatly affect how well your bankruptcy case goes. Working with the Massachusetts bankruptcy attorneys at the Law Office of Eric Kornblum is one of the best ways to get ready for your meeting of creditors. We will look into your case and ensure that everything is done properly during your 341 meeting. Schedule a conversation with our bankruptcy attorney immediately!
Why Do I Need a Springfield Bankruptcy Attorney?
A Springfield, Missouri bankruptcy lawyer will be able to help you if your debts are growing. People who file for bankruptcy can erase or reorganize their debts, including credit card, mortgage, and auto loan debts. However, it’s crucial that you understand the bankruptcy process and the applicable regulations before filing for bankruptcy. A bankruptcy lawyer in Springfield, Missouri, will be able to outline your legal options and assist you in choosing the bankruptcy that best fits your unique circumstances.
There are two types of personal bankruptcy recognized by United States bankruptcy law: Chapter 7 and Chapter 13. Depending on your financial situation and personal objectives, your Springfield bankruptcy lawyer may suggest one of these procedures.
341 Meeting of Creditors in Springfield Massachusetts: What is it?
The first meeting required by law in a bankruptcy process is known as a 341 meeting of creditors. Section 341 of the Bankruptcy Code is where the name of this event, often known as the creditors meeting, came from. A 341 meeting is held to:
- Review the debtor’s financial situation and to verify the information provided by the debtor in the bankruptcy filing. As a result, the debtor is required to show up for the 341 meeting and answer any questions under oath.
- Educate the debtor on the bankruptcy process and gives creditors and other relevant individuals the chance to inquire with regards to the debtor’s economic state.
The 341 hearing is optional for creditors, though. It usually takes place around one to two months after the debtor files for bankruptcy.
Should I be Nervous About the 341 Meeting?
No, particularly if your bankruptcy attorney has assured you that there is no need for concern.
What is the Role of a Bankruptcy Trustee in a 341 Hearing?
The trustee has the following responsibilities:
- The bankruptcy trustee who is in charge of the Chapters 7, 12, and 13 cases administers the hearing. An official from the United States Trustee runs meetings in Chapter 11 cases.
- Verify your identity and the accuracy of the details in your bankruptcy petition,
- Ensures that you pay as much as you can to your creditors.
- Examine any potential bankruptcy fraud.
- Carefully review your assets and search for any unreported sources of income,
- Sell any unprotected assets and use the cash to pay off any creditors’ debts.
What Takes Place in a 341 Meeting of Creditors in Springfield Massachusetts?
Whether you have to go to court in person or online will depend on whether the court is using social distance rules at the time. Approximately 10 Chapter 7 debtors and several Chapter 13 debtors will also be appointed within the same period.
Most trustees start by taking attendance and outlining the procedure. When your name is called, you’ll be directed to a desk located at the front of the courtroom where you will be asked to show your ID and swear under oath that you’ll respond to questions honestly and accurately.
If you have a domestic support obligation, you’ll also need to fill out a form and read a bankruptcy brochure until you’re called. Even though creditors rarely show up, they are allowed to participate in the 341 meeting as well as inquire about economic affairs.
Preparations for Meeting of Creditors
You should thoroughly read over your bankruptcy petition before the meeting of creditors. If you discover a mistake or have overlooked an important detail, you need to:
- If possible, submit an amendment prior to the hearing.
- Bring the issue to the trustee’s attention at the hearing.
Failure to state your name precisely as it shows on your license, passport, or government identification card is a typical filing issue. At the start of the hearing, you will provide one of these types of identification as well as verification of your Social Security card number. If they don’t match, you will have to amend your petition and perhaps return.
What to Bring in the Hearing
In most circumstances, you will have submitted or filed verifying documents with the trustee prior to the meeting of creditors, such as bank and retirement statements, paycheck stubs, and income tax returns. Additional items may be required by some trustees. Take these to the 341 meeting if you haven’t previously sent them to the trustee.
You should bring a set of bankruptcy papers to the 341 meeting for reference, as well as:
- a valid ID with photo,
- a copy of your Social Security card or another document that represents your Social Security number, and
- any records that prove a shift in finances since you filed your petition.
If you have a question about bankruptcy and 341 meeting of creditors in Springfield Massachusetts, our bankruptcy lawyers at the Law Office of Eric Kornblum are willing to help you. Schedule a conversation with them now.
What Are the Differences Between Chapter 7 and Chapter 13 Meeting of Creditors?
Both Chapter meetings will start in the same manner. The trustee will verify your identity and ask you the mandatory questions. Also, Chapter 7 and Chapter 13 trustees try to find ways to give creditors more money. This is because both types of trustees earn a percentage of any money that they recover.
However, Chapters 7 and 13 operate differently because they give different benefits to filers. As a result, Chapter 7 and Chapter 13 trustees assess cases in somewhat different ways.
Chapter 7 Creditors’ Meeting: What to Expect From the Trustee
The responsibilities of the Chapter 7 trustee are twofold:
- Determine if you are eligible for Chapter 7 (the trustee will examine your assets and check if your budget is sound and if you are eligible for a Chapter 7 discharge), and
- Put up for sale any property that a bankruptcy exemption cannot protect.
The Chapter 7 trustee will almost certainly begin by evaluating your budget. For example, the trustee will deduct your monthly expenses from your monthly income to determine if you have enough money to pay your creditors. If one of your expenses seems to be unreasonable, the trustee may request documentation to prove you spend that amount.
Should your finances show that you have enough money to pay your creditors, the trustee will suggest to the bankruptcy court that your Chapter 7 case be “converted” or transferred to Chapter 13.
If your budget is reasonable and you are eligible for a discharge, the Chapter 7 trustee will start examining your assets. At the end of the day, the trustee’s motive is to seek and sell assets that a “bankruptcy exemption” cannot protect.
For example, after examining your petition, the trustee could discover that the value of your property is worth more than you declared, or that you neglected to declare an asset that should be included in the bankruptcy case.
Chapter 13 Meeting of Creditors: What to Expect from the Trustee
Unnecessary or unreasonable expenses will also be scrutinized by the Chapter 13 trustee. If the trustee doubts your need for a specific expense, such as $500 a month for meal delivery service, and the judge rules that it is not justified, you will probably have to pay $500 extra to your creditors under your Chapter 13 repayment plan.
Furthermore, even if a Chapter 13 trustee does not sell your property, the trustee will consider the values you set on it because you need to pay your creditors at least the amount they would get in a Chapter 7 bankruptcy case, or the value of your nonexempt property.
All in all, the trustee will assess the viability of your requested Chapter 13 repayment plan and raise any issues at the 341 creditors’ hearing. If the court agrees or “confirms” the plan during the confirmation hearing, the Chapter 13 trustee will distribute monthly payments.
If Creditor Shows Up at the Meeting, What Will Happen?
Your creditors will be informed about the Chapter 341 hearing, but they likely won’t show up. Some examples of when a creditor could show up include the following:
- the creditor needs to know about your most recent credit card transactions and/or cash advances
- the creditor wants to know if you gave false information on your credit application, like your income, or
- a creditor might be an angry ex-spouse, business partner, or anybody who is owed money and is worried about getting paid.
The meeting is often used by creditors as a tool for investigation. They need to know more about your transactions with them to decide whether it’s worth challenging the discharge of the amount you owe. To avoid costly and time-consuming litigation, it’s best to try to reach a settlement with your creditor to see whether they have a legitimate complaint.
If the trustee believes the problem to be serious, he or she may extend the meeting so the creditor may ask further questions. The trustee will have an incentive to do so if the interrogation potentially lead to the discovery of previously undisclosed assets, as the trustee’s compensation is directly proportional to the amount of money distributed.
What Happens After the Hearing?
Anyone seeking to use Chapter 7 must take and submit a certificate of completion of a debtor education course. About 60 days after the trustee finishes the hearing, most debtors are discharged.
Following the completion of the petitioning process, Chapter 13 debtors must go through a confirmation hearing to have their Chapter 13 repayment plan confirmed. Once the application has been accepted, the filer must continue paying payments. With few exceptions, the monies are returned to the debtor if the bankruptcy court does not approve the Chapter 13 plan.
A Chapter 13 debtor must also attend the debtor education course and submit their certificate to the court before finishing the payment plan. After a bankruptcy case is filed and all the necessary requirements are met, the court will “discharge,” or wipe out, any residual debt that is eligible for discharge.
Start a Conversation with our Springfield Bankruptcy Lawyers Now!
We understand that the 341 Meeting of Creditors in Springfield Massachusetts may be a stressful and intimidating experience, but we are here to help you through it. In order to help you achieve the financial independence you deserve, the Law Office of Eric Kornblum is dedicated to providing you with caring and individualized legal representation.
Contact us immediately to start a conversation about your bankruptcy case and learn more about how we can help you in eliminating your debt.