What is a meeting of creditors in NYC?

One of our clients’ biggest concerns when considering bankruptcy in New York City is if they will have to go to court.  It can cause so much apprehension for some people that they may actually decide against or seriously delay their bankruptcy. The truth is that in most cases you will not be going to court.  Bankruptcy is intended to help get you back on your feet, and the informal meeting you do need to attend called the “meeting of creditors” is really no big deal.  The minor stress of this straightforward 5 minute meeting is certainly nothing compared to the daily stress of not being able to pay your bills.

Anytime a Chapter 7 bankruptcy is filed the petitioner must attend a mandatory hearing called the “meeting of creditors” or sometimes called 341 hearing.  You must attend this meeting before being granted a bankruptcy discharge.  The brief hearing exists so the bankruptcy trustee and your creditors can ask about your bankruptcy petition and the state of your personal finances.

In a practical sense and in almost all cases in New York the only people that will be at the meeting are you, your attorney and the trustee.  Your creditors have the right to appear and ask questions, but they almost never do.  It’s simply a waste of time and money for them, and in the off chance they do appear your attorney is present to protect you and to ensure the proceeding is run by the book.

Some of our clients envision a trial setting, with a judge and a witness stand and attorneys from the credit card companies interrogating them.  In actuality the hearing is a basic meeting that lasts about 10 minutes with usually three people sitting around a table.

The trustee will place you under oath and verify your ID before asking you a series of questions regarding your petition, schedules and other bankruptcy paperwork.  Their intention is to verify the information for the official record.  They are not there to cross examine you or trip you up with their questions.  In addition to verifying the information in the bankruptcy petition they may also request copies of your pay stubs, loan and mortgage statements, your most recently filed tax return, and any financial statements for bank and retirement accounts.  Your attorney will know ahead of time how to prepare and what the trustee may need. Usually after a quick review of the paperwork and handful of basic yes/no questions the trustee will wish you good luck in your financial recovery and adjourn the meeting.

After a simple financial management class you will not have to do anything else in a Chapter 7 case.  Unless the trustee needs more information based on your particular case they will at this point recommend a discharge to the bankruptcy court judge.  You will receive your official bankruptcy discharge about three months later, and your bankruptcy will be concluded.

If you are filing under Chapter 13 instead of Chapter 7 there is one more “confirmation hearing” that will determine if your proposed repayment plan will be approved.  The petitioner often does not need to attend this meeting.  Your qualified bankruptcy attorney will handle the negotiation of your repayment plan and attend this meeting.

At the end of the day for either Chapter 7, or Chapter 13 bankruptcy the 341 hearing (meeting of creditors) is not nearly as intense as has been rumored to be.  A qualified bankruptcy attorney will have you prepared and will be ready for anything the trustee may require in your case.  Don’t let the fear of short meeting with a government employee prevent you from getting the financial relief you need and that is your legal right.

If you live in New York and are considering bankruptcy relief, please call the Law Offices of William Waldner at at 212-244-2882 for a free bankruptcy consultation today.  You will be prepared for your meeting of creditors, and we will be there from start to finish ensuring your bankruptcy discharge.  As of 8/31/16 we have a 99% discharge record for Chapter 7 filings.

This article is intended for educational purposes only. By reading this article no attorney-client relationship has been created.