Will your creditors come to the 341 meeting of creditors?
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After you file bankruptcy, one of the steps that must be taken before your debts are discharged in a Chapter 7 or your payment plan is accepted in a Chapter 13, is a mandatory hurdle called the 341 Meeting of Creditors. In a Chapter 7 case, this meeting is set anywhere from 21 to 40 days after your petition is filed by your attorney. In a Chapter 13 case, the meeting will be set between 21 to 50 after your filing. All of your creditors you listed on your petition will be sent a notice about the meeting so they can attend.
Often, most creditors don't bother to show up, but sometimes they do. If they do make an appearance, what does this mean? Is it a bad or a good sign? Creditors that are most likely to show up are those with a local presence. If you bank at a local bank or credit union, they may send a representative if you owe them money. Homeowner's associations will sometimes send someone if you owe a substantial sum because they are notoriously aggressive about pursuing debt.
Most creditors do not show up for one or more of the following reasons:
Travel costs – Particularly if they are a national firm without any local representation, sending an agent can cost big bucks on top of the debt that will likely be discharged.
Lack of time – The meetings are rapid so they won't get any real face time with you, and the Trustee doesn't allow open ended questions fishing for information to help them.
Cost/benefit – Firms have to balance whether the expense of sending someone will produce an offsetting benefit and, particularly if the debt is unsecured, this is unlikely.
For secured debts like a home or a car, the creditor may send a representative to ask if you plan to try and keep the asset after your filing, what your plans are to satisfy the secured debt are and what condition the asset is in. The appearance of a creditor at the 341 meeting may also be a warning sign that they suspect your are hiding assets, are committing bankruptcy fraud or may be considering filing an objection to having their debt discharged. This is done with a special counter suit called an adversary proceeding.
The bottom line is that your North Carolina bankruptcy attorney will attend the 341 meeting with you and will ensure that no creditors try and force you to answer questions that are outside the bounds of the law or harass you in any way. If you are not sure about anything you are asked, you can always ask your lawyer for clarification – that's what they are there for and since you are under oath when you answer questions, it's important that you answer honestly.
To find out how Chapter 7 or Chapter 13 bankruptcy can help you get your debts under control and get a financial fresh start today. Contact the law offices of John T Orcutt for a free consultation today.