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What happens at a section 341 meeting of creditors?

If you have filed a chapter 7 or chapter 13 bankruptcy, you may feel anxiety upon hearing that you will need to attend the section 341 meeting of creditors. It is called a section 341 meeting because that is the section of the Bankruptcy Code that requires it take place. Provided you have disclosed all of your property, income and debts, there is no need to be nervous. However, knowing what to expect may help you feel more comfortable.

Documents submitted in advance or brought to the meeting

Prior to the meeting, you have to submit your most recent tax return to the trustee for review, and other documentation may be required. Your lawyer will let you know what you need and when it needs to be submitted. You will also be required to bring proof of your identity and social security number.

What to expect

The meeting is scheduled within sixty days from the date your bankruptcy petition was filed. The trustee runs the meeting and asks you questions which you are required to answer truthfully as you will be under oath. You and your attorney attend in person. Often this meeting is held in a room with other debtors waiting for their turn in front of the trustee.

The purpose of the meeting is to verify that documentation you submitted with your bankruptcy petition is accurate, and that your income, property, and debts were fully disclosed. Creditors are not required to attend the meeting, but if you have secured debt, (meaning a loan that is secured by property that can be repossessed for non-payment) it may be more likely that an attorney on behalf of the creditor will attend.

What if a creditor attends?

If you have a secured creditor in attendance, their attorney will likely ask you about the current condition of the property that was used to secure the loan. They may ask for proof that the property is insured or being maintained, or if you want to surrender the property back to the bank or keep it. If you want to keep the property, they will ask if you are capable of maintaining payments in the future, based on the income you submitted.

The trustee may decide to abandon property of the estate during the meeting. This means that the trustee will not seize that item and sell it to distribute the money to your creditors. If you are a chapter 7 debtor, your discharge often follows soon after the meeting concludes. If you are a chapter 13 debtor, there will be a plan confirmation hearing in front of a judge in addition to this meeting, and your discharge will not be granted until you complete all payments under the plan.

Knowing what to expect often helps Debtors in bankruptcy relax a little prior to this meeting. If you would like to see an example of questions that a trustee may ask, you can find a list here. The United States Courts has a You Tube page, with a video that shows a 341 meeting, which can be found here. Bankruptcy can be intimidating, but you will be on to your fresh start before you know it.

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