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Going To Court In Your Bankruptcy Case

By Cathy Moran

bankruptcy hearingEvery bankruptcy debtor must attend the first meeting of creditors in their case.

It’s usually the first and only time that your personal appearance is required.

The meeting is nicknamed the “341 meeting” from the section of the Bankruptcy Code that requires it. 

What’s the point of going to court

The first meeting of creditors has two basic purposes: to have the debtor validate the information in the bankruptcy papers under oath, and to provide the trustee any information needed to determine exemptions or administer any non exempt assets.

More about the role of a Chapter 7 trustee

It’s also an opportunity for creditors, who are likely to take a financial hit in your bankruptcy case, to ask questions of the debtor.  Those questions must be limited to inquiries about assets and about debts.

How does the first meeting of creditors work

The trustee, not a judge, conducts the meeting and leads the questioning.  Creditors are invited but seldom attend.

The meeting is not a test or an inquisition.  Its focus is on validating and perhaps expanding on the information in the bankruptcy papers.

If you genuinely don’t know the answer or don’t understand the question, it’s OK.  Just say so.  The trustee will adapt by rephrasing the question or asking that you supply supporting information.

Usually, each debtor’s testimony is concluded in a few minutes.

Rules for testifying

Here are my rules for how to behave:

  1. Tell the truth
  2. Listen to the question……. all the way to the end.
  3. Answer in as few words as possible
  4. Don’t explain, expand, justify, or speculate unless asked
  5. If your attorney starts talking, you stop talking

While I have seldom had clients blow a case at the 341 meeting, they can certainly either prolong the meeting or confuse the trustee or the issues by babbling.

So, start by listening, carefully, to the question.

Bring your identification; be familiar with the information in the schedules; and answer questions in short sentences and all will be well at your first (and probably last) meeting of creditors.

More

About the 341 meeting.

How to review your bankruptcy schedules before they’re filed

Tips for worry free bankruptcy

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Filed Under: How bankruptcy works

About Cathy Moran

I'm a veteran bankruptcy lawyer and consumer advocate in California's Silicon Valley. I write, teach, and speak in the hopes of expanding understanding of how bankruptcy can make life better in a family's future.

Trackbacks

  1. Bankruptcy’s First Meeting of Creditors Is Over-hyped says:
    November 10, 2011 at 7:14 am

    […] I haven’t mentioned that the first meeting of creditors has an alias:? it’s also known as the 341 meeting, since that’s the section of the Bankruptcy Code that requires that the debtor be examined about his petition and schedules under oath. I have five simple rules for testifying at the 341 meeting. […]

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About The Soapbox

You’ve arrived at the Bankruptcy Soapbox, a resource of bankruptcy information and consumer law.

Soapbox is a companion site to Bankruptcy in Brief, where I try to be largely explanatory and even handed (Note I said “try”).

Here, I allow myself to tell stories and express strong opinions. We dig deeper into how to consider bankruptcy and navigate a bankruptcy case.

Moran Law Group
Bankruptcy specialists for individuals and small businesses in the San Francisco Bay Area

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