Sadly, the issue many people face is that they hear about 341 meeting horror stories, so they automatically assume the worst for their hearing.
However, most 341 Meetings last about five to ten minutes. The bankruptcy trustee asks the standard 341 questions. No creditors appear, and the trustee concludes the meeting without any 341 Meeting fears.
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Knowing what to expect at a bankruptcy hearing reduces stress and anxiety. Here are some things that happen at every 341 Meeting of Creditors:
In most cases, the trustee concludes the Meeting of Creditors. This means the meeting is finished. However, if you didn’t bring a form of identification or the trustee has other questions, the trustee could continue the 341 Meeting until the next hearing date.
Bankruptcy Tip for 341 Meetings: Arrive early and watch a few cases. You will know what to expect during your hearing, which will help you feel calmer.
There’s nothing to fear about the 341 Meeting with Creditors. The bankruptcy trustee is not there to harass or embarrass you, nor do they intend to trick you. Bankruptcy trustees treat debtors with respect and empathy. However, you should also treat the trustee with respect and courtesy by being prepared for your hearing and truthful in your responses.
In most cases, 341 Meeting horror stories happen because a person hired an inexperienced bankruptcy attorney, decided to file bankruptcy without an attorney, or hired a lousy one. A good indicator of a lousy attorney is a lawyer who charges much lower rates than bankruptcy lawyers would in the area or charges legal fees that are too good to be true.
A small number of bankruptcy hearings resulted in 341 Meeting horror stories. In most cases, these hearings are boring and standard. Things can go wrong, but it’s usually avoidable if the person takes simple steps to prepare for the hearing.
You can tell when a person is not prepared for their 341 Meeting. If they can’t answer basic questions such as the value of their home or car and whether they reviewed and signed bankruptcy forms, it’s clear that they have no clue what’s going on, which then results in the trustee becoming frustrated.
Filing bankruptcy is a serious legal matter. You ask the court to forgive your unsecured debts, which could total tens of thousands of dollars. Generally, this 341 Meeting horror story happens for one of two reasons:
How can you avoid this situation? Hire an experienced bankruptcy attorney to handle your bankruptcy case whenever possible. Also, review your bankruptcy forms several times before going to court for your hearing.
Most individuals file for bankruptcy under Chapter 7 or Chapter 13.
Chapter 7 is a “straight” bankruptcy that does not require you to repay your unsecured debts. However, you must continue paying the loan if you want to keep your home and car.
Take the Chapter 7 calculator below to see your pros and cons if you considered a Chapter 7 bankruptcy.
Chapter 13 is a repayment plan. You propose a Chapter 13 plan that repays a portion of your unsecured debts based on your disposable income. Most Chapter 13 plans are 60 months, but some people qualify for a 36-month.
A common 341 Meeting horror story involves a debtor losing their home or car because they are behind on loan payments. When you file under Chapter 7, you must catch up on your loan payments immediately, or the creditor can take the secured as collateral.
As a result, you find out at the 341 hearing that the creditor intends to take your home or car unless you can pay thousands of dollars in past due payments at that exact moment.
How can you avoid this situation? If you file a Chapter 13 case, you can catch up on the past due mortgage or car loan payments over a 60-month bankruptcy plan. Putting the past due mortgage or car loan payments in the bankruptcy plan makes keeping your car and home affordable. Also, filing Chapter 13 can protect other assets that bankruptcy exemptions might not cover.
Bankruptcy fraud is a crime. You can go to prison and be charged with substantial fines for committing bankruptcy fraud. Examples of bankruptcy fraud include, but are not limited to:
How can you avoid this situation? Review your bankruptcy forms to ensure all information is accurate and complete. Do not try to hide assets. The most common type of bankruptcy fraud is concealing assets, including fraudulently transferring assets. Answer all questions at the 341 meeting wholly and truthfully.
Giving or transferring assets to family members or paying debts owed to family members before filing bankruptcy can result in allegations of bankruptcy fraud. It can also result in a lawsuit against your family member.
The Chapter 7 trustee may file an adversary proceeding (a lawsuit in your bankruptcy case) against your family member. The lawsuit demands that your family member pay the bankruptcy estate the money you paid them or turn over the asset you sold or gave them. As a result, your family member could owe thousands of dollars to the bankruptcy trustee.
How can you avoid this situation? Do not transfer or give your family or friends any assets before filing bankruptcy. Do not repay debts owed to your family members either. After your bankruptcy case closes, you can then repay the debt.
If you have given or sold property of significant value to your family members within the past six years, talk to a bankruptcy attorney about the transfer before filing bankruptcy.
If you need a bankruptcy lawyer, we’ll help you locate one who offers free bankruptcy consultations in your area. That way, you can learn more about how bankruptcy can help you get out of debt.
We can also discuss non-bankruptcy alternatives. Most of our services are offered free of charge. Call or text us at (310) 307-5134 or contact us online for a free case evaluation.
Bankruptcy can be a great way to get a fresh start when your debt has become unaffordable due to financial hardship. Bankruptcy is for those who have a strong desire to pay their bills, but may not have the ability to pay those bills.
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