A meeting of creditors is essentially a hearing used to verify the accuracy and completeness of the information contained in bankruptcy filings. There are no court hearings for most parties filing for bankruptcy with a judge. The creditors’ meeting is the only direct interaction with the bankruptcy trustee or the bankruptcy system. The bankruptcy trustee calls a meeting of creditors after all questions have been asked and answered, which often takes less than five minutes.
At the Creditors Meeting (also called the 341 Hearing), the trustee will ask about bankruptcy forms, property, debts, etc. A Chapter 7 meeting of creditors (also called a 341 hearing) is a meeting where the trustee and your creditors can ask you sworn questions about your bankruptcy filing and the documents you must provide the trustee. The Chapter 7 bankruptcy trustee will hold a meeting of creditors and ask some questions about the information provided in the bankruptcy filing.
A 341 meeting is an opportunity for bankruptcy trustees and creditors to ask sworn debtors about their assets, liabilities, and other questions related to the bankruptcy case. The 341 Meeting is also designed to help debtors understand the bankruptcy process and allow creditors and other interested parties to ask questions about the debtor’s financial problems. The insolvency representative notifies the parties named on the bankruptcy petition of the time and place of the meeting of creditors. When the court issues a notice of commencement of proceedings (click here for a sample notice), it will include information about the date, time, and place of the meeting of creditors.
You will also provide your bankruptcy case number and the filing date to any creditor who can call. You will use the trustee’s contact information to file 521 bankruptcy documents (payrolls, bank statements, and tax returns) that you must provide to the trustee prior to the 341 meeting of creditors.
The 341 meeting is slightly different depending on the bankruptcy chapter you have filed, the bankruptcy district you are in, and the trustee assigned to your case. All persons filing for bankruptcy under chapters 7 and 13 must attend the 341 hearing and meet with the trustee in charge of the case. The trustee will likely nominate up to ten other bankruptcy filers for the same hour, so other Chapter 7 debtors will be watching your hearing pending their case.
In the case of Chapter 13, about a month after the meeting, there will be a court hearing where the bankruptcy judge will decide whether your repayment plan will be approved and confirmed by the bankruptcy court. A chapter 13 confirmation hearing allows Chapter 13 debtors to file a proposal for a plan to pay off their debts and submit it to a bankruptcy judge. The 341 Meeting is intended to establish the facts of the bankruptcy in question. Considered bankruptcy and facilitated negotiations on a repayment plan between the debtor and his creditors.
Although lawyers for the debtor and creditor are invited to attend, the only parties whose presence at the 341 Meeting is required by law are the debtor in question and the court-appointed trustee. Unlike a 341 meeting, which debtor the debtor must attend, debtors may allow their bankruptcy attorney to attend the meeting in their stead. When a business goes bankrupt, or an individual goes bankrupt with many business-related debts, creditors or lawyers are usually present.
Creditors may also be involved, although in many bankruptcy cases, creditors do not appear. While meeting creditors is a big part of the bankruptcy process, debtors may have to move out of town, get sick, or have essential responsibilities they can’t put off. The invitation is because creditors have minimal time to ask questions and will generally not benefit from attending a creditors’ meeting unless they suspect you are hiding assets or committing bankruptcy fraud.
If creditors ask no questions, the trustee usually continues the debtors’ meeting again to ask additional questions (more on that below). If the matter seems serious, the trustee may continue the meeting to give most creditors more time to ask questions.
Neither the trustee nor the creditors may take any action at a meeting at which any central issue of the case is decided. If new or disturbing facts come to light at the meeting, the trustee or creditor may file a petition or claim of controversy in the bankruptcy court for adjudication. Creditors can apply to the court for an injunction requiring the debtor to appear for further examination, such as removal, under the 2004 bankruptcy rule.
After filing a bankruptcy petition, the court appoints a meeting of creditors in accordance with Article 341 of the Bankruptcy Code. Creditors will present a credit certificate to inform the trustee of the claim, including the amount owed to them, so that the trustee can pay the creditor (if applicable). Regardless of which bankruptcy chapter they file, each debtor must be personally present in the case.« Back to Glossary