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Going to Your Bankruptcy Court Hearing — The Meeting of Creditors

Meeting of Creditors in Bankruptcy Court [1]Written by Craig D. Robins, Esq.
In every consumer bankruptcy case, whether it is a Chapter 7 bankruptcy or a Chapter 13 bankruptcy, there will be an initial hearing at the bankruptcy court about one month after the case is filed.  If you filed for bankruptcy, you are required to attend.
What’s Happens at the Meeting of Creditors in Bankruptcy Court?
The purpose of the hearing is for the court-appointed trustee to ask you questions about your financial situation, the reason why you have debt problems, and whether you have any non-exempt assets.
This meeting is rather informal, as it is not in a courtroom, and it is not before a bankruptcy judge.  Instead, it is in a hearing room, and it is before a trustee, who is a bankruptcy attorney, and not a judicial officer.  See my post: Don’t Call the Bankruptcy Trustee, “Your Honor” [2].
As a matter of fact, the bankruptcy law even bars bankruptcy judges from attending the Meeting of Creditors.  See:  Bankruptcy Judges Are Barred by Law From Attending the Meeting of Creditors [3] .
A bankruptcy trustee presides over the meeting by calling cases, one at a time.  When your case is called, you sit at a table in the front of the room with your bankruptcy lawyer, and the trustee asks questions after you’ve been sworn in.  To learn more about trustees, see What Is a Bankruptcy Trustee? [4]
Most meetings are relatively short and uneventful.  Although they will typically last just a matter of a few minutes, you may wait as much as 60 to 90 minutes for your hearing.  The meetings are recorded by an electronic device, and there is a microphone on the table.
Since the meetings are somewhat informal, you do not have to get dressed up or wear a suit.
The Meeting of Creditors is also commonly referred to as the “341 Hearing” or “341 Meeting” because it is Bankruptcy Code section 341 that contains the law regarding such meetings.
Role of the Bankruptcy Trustee
The trustee is charged with several obligations which include making sure the bankruptcy petition is properly prepared, making sure any assets you intend to keep are protected by exemption statutes, ensuring that you properly completed the Means Test [5], and ascertaining whether you have any non-exempt assets that can be sold for the benefit of creditors.
It is usually rare, but not uncommon, that a trustee determines that there are non-exempt assets.  The most common types of non-exempt assets include cars, tax refunds and personal injury law suits.  In each case, if the asset is worth more than the exemption amount, the trustee can administer the asset.  For more information about whether a trustee will pursue an asset, see:  The Back-Door Politics Behind Trustees Pursuing Non-Exempt Assets [6].
If you live in New York, you can check some of the most common bankruptcy exemptions here:  Bankruptcy Exemptions in New York [7].
If the trustee does try to sell an asset, he is entitled to be compensated for doing so.  Information about this is in this post:  How Does a Chapter 7 Bankruptcy Trustee Sell Assets [8] .
Some clients primarily speak a second language like Spanish, and need the assistance of an interpreter.  In the Central Islip Bankruptcy Court, the court now provides interpretation services at the Meeting of Creditors.  See:  Interpreters in Bankruptcy Court [9] .
It is relatively rare that a creditor will show up.  Generally speaking, credit card companies, which constitute the most common type of creditor, will never show up.  I discussed this in my post:  Will Creditors Show Up For My Hearing In Bankruptcy Court?  [10] However, If a Creditor Shows Up at the Meeting of Creditors in Bankruptcy Court, What Questions Can They Ask? [11]
As far as questions at the Meeting of Creditors that the trustee asks you, it is very important to answer each question accurately and honestly, but you should not provide any additional information, other than simply answering the question.  For more about how you should answer questions, see this post:  How Much Should You Say at the Meeting of Creditors in Bankruptcy Court? [12]
When Is the Meeting of Creditors?
This is the topic of an article I recently wrote:  When Is My Meeting of Creditors in Bankruptcy Court? [13].  Generally, the meeting is about one month after the date of filing.  There is a lot of information on this post.
What Can Go Wrong at the Meeting of Creditors?
The vast majority of hearings at the Meeting of Creditors go very smoothly and last just a few minutes.  If your bankruptcy attorney did a good job in drafting the bankruptcy petition and preparing you for the meeting, everything should go find.
Nevertheless, lots of things can happen at the Meeting of Creditors to complicate things.  Several years go I wrote a lengthy series of articles for the Suffolk Lawyer about how to address unusual issues that may arise at the Meeting of Creditors in bankruptcy court. 
If you have a Meeting of Creditors coming up, this series of articles should be extremely useful:
        Everything That Can Go Wrong With the Meeting of Creditors. Part One: Common Problems [14]
        Everything That Can Go Wrong With the Meeting of Creditors. Part Two: Issues with the Trustee [15]
        Everything That Can Go Wrong With the Meeting of Creditors. Part Three More Problems and Dilemmas [16]
Preparation for the Meeting of Creditors is Key
I cannot stress how important it is to have your bankruptcy attorney prepare you for the meeting of creditors.
In my Long Island bankruptcy practice, we review with each client the various questions the trustee will most likely ask, as well as our client’s responses, to ensure that the meeting will go smoothly.  We usually do this a few days prior to the meeting.
Are You Curious About Your Bankruptcy Trustee?
If your hearing is in the Central Islip Bankruptcy Court, which is in the Eastern District of New York, you can read profiles about each trustee and see their picture, most of which I took.  Here is the link:  Bankruptcy Trustee Profiles [17] .
Can the Trustee Decline to Grant You Bankruptcy Relief at the Meeting of Creditors?
The answer is “absolutely not.”  The purpose of the meeting is for the trustee to obtain information about your case.  The trustee does not have the ability to take any action against you or decide whether or not you are entitled to a discharge.
Only a bankruptcy court judge can do such things.  Also, every debtor is entitled to a discharge unless a proceeding is brought challenging discharge — and these are very rare.
Directions to the Central Islip Bankruptcy Court on Long Island
If your meeting of creditors is in Central Islip, here’s how to get to the court:  Directions to Central Islip Bankruptcy Court – Long Island [18].
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