What Can I Expect To Happen Once I File For Bankruptcy?
After filing for bankruptcy, you’re going to have to submit to a 341 meeting. The 341 meeting is an examination by the trustee and the creditors. At the meeting, the trustee and creditors are allowed to ask you questions about your financial circumstances and review the information you put on your schedules and statement of financial affairs. You might also be subject to a 2004 examination, which is a deposition where you’re asked questions under oath about your financial circumstances. Typically, in a Chapter 7, after you do the 341 meeting, there usually isn’t a 2004 exam unless there’s something unusual about your situation. After about three months, you would obtain a discharge whereby your debts are discharged. During the course of the bankruptcy, and after discharge, no creditor can take any action to try to collect on those debts.
When Must I Complete The Pre-Bankruptcy Credit Counseling Course?
You have to complete the pre-bankruptcy credit counseling course before you file, or immediately thereafter. It’s best to complete the course before you file so that you can be in a position to state that you have completed it.
What Generally Happens In The Bankruptcy Process For Both A Chapter 7 and A Chapter 13?
The process in a Chapter 7 is more rapid and easier. After you file your petition for Chapter 7, you’ll be scheduled for a 341 meeting. That’s an examination by the trustee and creditors. After that period of time, there’s a certain amount of time in which people can file claims. The trustee will review your schedules and statement of financial affairs and determine whether or not there are assets subject to liquidation. If so, they will notify the creditors so that they can file claims timely. In a typical Chapter 7 case, there are no assets because the assets that debtors usually have are exempt. Then, after about three months, the court will enter a discharge, the bankruptcy case will be over, your debts that are listed on your schedules will be discharged, and no creditor can ever take action to collect on the discharged debts.
A Chapter 13 is different in that you would have to prepare a proposed plan to pay off your debts. You have the same schedules and statement of financial affairs found in a Chapter 7, but you will have to propose a plan that shows that you will pay X number of dollars to the trustee, who will then distribute that money to the creditors in whatever fashion is spelled out in the plan. If the plan is confirmed, you pay that sum of money each month to the trustee. The trustee distributes it for three to five years. Assuming everything goes smoothly, upon the ending of the three or five-year period, the trustee will notify the court that the plan has been completed and that it’s time to end the case.
If, however, during the course of the Chapter 13 plan you do not make the payments that you are supposed to make, the trustee will notify you and the court, and there could be a hearing to either dismiss your case or transfer it to a Chapter 7 liquidation. You will have a chance to explain your circumstances and try to either cure whatever deficiency exists or be converted to a Chapter 7.
When Will I Need To Attend The 341 Meeting In A Chapter 7 Bankruptcy?
The 341 meeting is routinely scheduled right after you file your petition or at the time that you file your petition, which is usually within about three to four weeks. Currently, they’re not having live 341 meetings, they’re doing them remotely. At the meeting, you can expect the trustee to ask you questions about what caused you to file bankruptcy and other basic questions about your financial circumstances. They will also ask you to provide several years of tax returns and make seek clarification on the information you put on the schedule and a statement of financial affairs. The creditors who are interested in your situation have a right to ask you questions about the same things the trustee asks you. Most of the time, the 341 meeting is very brief. It lasts maybe five to 10 minutes.
Other times, it can take a bit longer. But typically, if there are creditors who are asking a number of questions, the trustee will not allow them to go on very long. They will require the creditor to schedule a 2004 exam or a deposition to go into more detail about what’s concerning them about your bankruptcy.
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