Hire an Experienced Bankruptcy Attorney to Help Your 341 Meeting Go Smoothly
For many bankruptcy filers, the prospect of the Section 341 meeting of creditors can cause stress and anxiety. Is something bad about to happen? Will you be scolded or yelled at? Made to feel ashamed for your need to file for bankruptcy? Could you say something wrong that makes your situation worse?
It’s perfectly normal to be apprehensive about your 341 meeting. However, most 341 hearings go quickly and smoothly.
As with all other aspects of your bankruptcy case, preparation is the key. A trusted debt settlement lawyer, such as Denver-based Wink & Wink, is essential to make sure you’re prepared as well as provide any guidance at the meeting.
What Is a 341 Meeting?
The meeting of creditors is described in section 341 of the Bankruptcy Code, hence the name “341 hearing.” It provides for a United States Trustee to convene and preside at a meeting of creditors and directs the trustee to “orally examine the debtor” (you) in a Chapter 7 case to make sure you are aware of:
- The consequences of filing for bankruptcy;
- Your ability to file a petition under another chapter (such as Chapter 13);
- The effect of any discharge of debts; and
- The effect of reaffirming any debt.
What happens in reality is that the bankruptcy trustee reads an advisement and then begins calling cases by debtor name. Once you hear your name called, you and your bankruptcy attorney walk up to the desk or podium and the panel trustee places you under oath, checks your identification, and asks you questions on the record about your bankruptcy petition and your financial situation.
In Colorado, you will also hand a completed “Trustee Information Sheet” to the panel trustee along with a bank statement and pay stub that covers the date your case was filed. Additionally, the trustee must already have received a copy of your most recent tax return. These requirements alone are enough reason to make sure you are represented by a debt settlement lawyer at your 341 hearing. If you are answering questions about your case under oath, it’s crucial you have legal representation to avoid an unwanted outcome.
Who Is the Bankruptcy Trustee?
In a Chapter 7 bankruptcy, private trustees—or panel trustees—are appointed to administer estates under the supervision of the United States Trustee for their judicial district.
That means there is a U.S. Trustee’s office in each judicial district (part of the Department of Justice), and then each U.S. Trustee’s office has a panel of private trustees who do the day-to-day work of administering Chapter 7 cases, which includes presiding at the 341 meeting.
These panel trustees are usually private bankruptcy attorneys who do the work on a part-time basis. They take a cut of any assets they find in the bankruptcy estate, along with a flat fee for each case they administer.
In a Chapter 7 bankruptcy case, you have two levels of trustee involvement:
- The U.S. Trustee, who is reviewing your case to make sure you qualify for Chapter 7 and that your case is not an “abusive filing”; and
- The panel trustee who is looking for assets they can sell to make money.
What Is the Panel Trustee Looking For?
Because the panel trustee has a financial stake in every Chapter 7 case they see, the 341 hearing really boils down to one thing: money.
The panel trustee is looking to see if you have assets they can liquidate because that is how they get paid.
The panel trustee takes:
- 25% of the first $5,000;
- 10% of the next $45,000;
- 5% of the next $950,000; and
- 3% of anything over $1,000,000.
Therefore, the questions you are asked are tailored to determine if your estate has any non-exempt assets.
For example, if you own a car, the trustee will want to know how you came to the value you listed for it in your bankruptcy petition. If the trustee thinks the value is too low, they may order an appraisal.
A bankruptcy lawyer is invaluable in preparing you for the types of questions you may be asked at the 341 hearing. This is because your attorney, in preparing your Chapter 7 bankruptcy case, will know what property or interests you have that will be of interest to the trustee and can prepare you accordingly.
If you’re seeking a debt settlement attorney near you in the greater Denver area, the lawyers at Wink & Wink can help you file for bankruptcy and get the best result possible based on your particular situation.
Are the Creditors at the 341 Meeting?
Since the 341 hearing is technically called the Meeting of Creditors, you may be wondering where the creditors are in the process.
All of your creditors receive notice of your bankruptcy and also the date of your 341 meeting.
However, it is very rare for a creditor to actually appear at this meeting.
In fact, the only time you usually see creditors at the 341 hearing is when the creditor is an ex: ex-wife, ex-husband, or ex-business partner, i.e., someone with an opinion about your bankruptcy or who wants the trustee to know some facts about your case that perhaps you didn’t include on your petition (for example, that you own several other cars that you left off the petition).
You are very unlikely to see, for instance, a bank or credit card company at your 341 meeting. They just aren’t emotionally involved, and they don’t have the staff or money to send someone to every meeting of creditors when one of their customers files for bankruptcy.
The Role of the Bankruptcy Lawyer at the 341 Meeting of Creditors
The 341 meeting is a perfect example of why having a lawyer prepare your bankruptcy and represent you at the trustee meeting is essential. People who attend the meeting without an attorney from a bankruptcy law firm often get overwhelmed or flustered by the questions. They may panic and feel they don’t know what to do. A debt settlement lawyer like Wink & Wink of Denver, Colorado, has attended tons of these hearings, and knows how to calmly and confidently respond to anything that may get thrown your way.
Without legal representation from a bankruptcy attorney, the risk becomes much higher of your case being dismissed for failure to provide your tax return to the trustee or you having to surrender property that you could have kept with a skilled bankruptcy attorney by your side.
Be Prepared for Your 341 Hearing
341 meetings are nothing to be scared of, but you’ll likely feel much more prepared and ready with the help of a debt settlement law firm. Bankruptcy is stressful enough. Increase your chances of a positive outcome and a much less painful experience by reaching out to Denver bankruptcy law firm Wink & Wink by contacting us online or by calling 303-410-1720.