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The 341 Meeting of Creditors is the first hearing that you are required to attend after filing a Chapter 7 or Chapter 13 bankruptcy.
The 341 Meeting of Creditors does not have to be the most stressful part of your Michigan Chapter 7 or Chapter 13 bankruptcy case. However, for many, it is exactly that.
Generally speaking, you will find the 341 Meeting of Creditors process to be more dull than anxiety-inducing and more routine than ravaging for the players involved.
Then again, the thought of being asked questions about your most personal financial information with a tape recorder running in a small room full of strangers may be the very definition of the word “terrifying” for you.
Indeed, the Bankruptcy 341 Meeting of Creditors should not be approached too casually. However, with the right Michigan bankruptcy attorney working for you, there is also no reason to panic over it.
Nevertheless, there are some serious mistakes you can make at your 341 Meeting of Creditors that are worth discussing in advance.
This Article will attempt to do that.
However, first, we will discuss some basics about the 341 Meeting of Creditors.
What Is the 341 Meeting of Creditors?
The 341 Meeting of Creditors is a mandatory hearing held in the Michigan Chapter 7 and Chapter 13 bankruptcy process.
It is an opportunity for your creditors and the Chapter 7 Trustee or Chapter 13 Trustee to ask you questions about your income, your expenses, your debt, your assets, and the documents you filed in your bankruptcy case.
Depending upon in which Federal Bankruptcy Court you filed your case, and which Chapter, it will be held in different locations. (Or, post-COVID, telephonically or via Zoom or other video conferencing platform.)
The 341 Meeting of Creditors is not a judicial hearing. Your Bankruptcy Judge will not be present. Instead, it is presided over by a Chapter 7 or Chapter 13 Trustee (or, in Detroit, a Chapter 13 Trustee’s staff attorney or even paralegal).
IMPORTANT REMINDERS REGARDING REMOTE 341 MEETINGS
- Be sure to KEEP YOUR PHONE ON MUTE until your Trustee calls your case.
- Be sure to CALL FROM A QUIET PLACE as your Trustee must record the hearing.
- Do not call in from your car while driving as this is unsafe distracted driving and your Trustee will likely not conduct your hearing. Your Trustee will want you to be engaged in the hearing, sitting down and paying attention to the Trustee questions.
- Do not put your phone on hold as oftentimes music plays and disrupts the other hearings.
- Do not use a speakerphone or Bluetooth headset as the Trustees have difficulty hearing or recording the meetings.
- Speak in a clear, loud voice and answer the Trustee’s questions precisely and succinctly.
- If your hearing is being held via Zoom, be sure that you name the device that you use to call in with your name and that you have enabled both the audio and the camera as your Trustee will want to see you.
- This is a Federal hearing in which you will be sworn in under penalty of perjury. Take it seriously and tell the truth.
Proper Etiquette for Zoom Bankruptcy Hearings
Your Bankruptcy Meeting of Creditors (also known as the .341 Hearing) is a Federal Court Hearing. The typical hearing takes about 5 minutes and requires your utmost attention. Take it seriously as you will be testifying under oath as to the accuracy and completeness of your Bankruptcy Petition.
You should be sitting in a quiet, well-lit room with a good internet connection and either a computer, tablet or cell phone with a working camera, microphone and speakers. I recommend downloading the Zoom App if you are using a smart device such as a cell phone or tablet. Your Trustee will not conduct your hearing if you are driving your vehicle, working on the line, walking your dog, doing the dishes, etc.
Be sure to keep your microphone as well as your camera muted until your Trustee calls your case at which time you will unmute both the phone and camera. Be sure to speak loudly and clearly as your Trustee is required to make a recording of the meeting. United States Trustee regulations require that your camera be on while you are testifying.
When Is the 341 Meeting of Creditors Held?
The 341 Meeting of Creditors is scheduled 20-40 days from the date that you file your Chapter 7 or Chapter 13 bankruptcy case.
This timing is set by the US Bankruptcy Code. This “Code” is the Federal statute that governs the bankruptcy process in the United States.
Generally, you can expect to be required to attend your 341 Meeting of Creditors about 30 days after your case is filed—give or take.
This will be true regardless of whether you file a Chapter 7 or a Chapter 13 bankruptcy. It will be true regardless of where in Michigan, or elsewhere in the US, that you file your case.
What will differ between the two Chapters of consumer bankruptcy and the location of the 341 Meeting will be the process involved in the actual hearing.
This can, in fact, differ greatly from Trustee to Trustee, let alone from Detroit to Bay City.
Who Is this Trustee Person?
The Chapter 7 or Chapter 13 Trustee is the “administrator” of your Bankruptcy Estate.
That is, the Trustee is the person assigned by the US Bankruptcy Court in which you filed your Chapter 7 or Chapter 13 to supervise your case. The Trustee has legal authority over the assets of your Bankruptcy Estate, more importantly.
We’ve written extensively about the Chapter 7 Trustee and the Bankruptcy Estate elsewhere on our blog.
However, in summary, the Bankruptcy Estate is the legal estate containing all of your property and your claims to property. It is created the moment you file a Chapter or Chapter 13 Case with the Bankruptcy Court in Detroit, Grand Rapids, Flint, Bay City, or elsewhere in Michigan.
In a Chapter 7 Bankruptcy, the Chapter 7 Trustee has the authority to seize and liquidate your assets in order to generate money with which to repay your creditors.
In a Chapter 13 Bankruptcy, assets are not liquidated. However, the value of your assets may govern the overall costliness of the Chapter 13 process—and you still won’t have the right to sell off or transfer any of your assets without a court order allowing you to do it in that process.
In either case, one of the Chapter 7 and Chapter 13 Trustee’s tasks in your bankruptcy process is to hold and preside over the 341 Meeting of Creditors.
Top 5 341 Meeting of Creditors Mistakes
All of that said, what are the Top 5 mistakes you can make at your 341 Meeting of Creditors?
Note our use of the word your, for starters. This is your bankruptcy. This is your bankruptcy hearing. This is your debt discharge at stake.
The biggest underlying mistake you can make, mentally, is to shift responsibility for the success of your Michigan Chapter 7 or Chapter 13 bankruptcy process and your 341 Meeting to anyone else. Your spouse, your employer, your bankruptcy attorney—anyone.
A good bankruptcy lawyer will tell you what you need to do, to bring, where to be, but it will be up to you to follow the advice provided to you at the end of the day.
On to the Top 5 Section 341 Meeting of Creditors Mistakes, then, bearing that in mind.
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Not Showing Up or Not Showing Up On Time
Your 341 Meeting of Creditors will be scheduled for a specific time on a specific date. You need to be there (or post-COVID, call in via telephone or Zoom videoconference) prior to that time. If your bankruptcy lawyer tells you to be there, say, 30 minutes ahead of time, that is the time you need to appear.
When you arrive, you will find that yours will not be the only hearing held at that required docket-time. If your 341 Meeting of Creditors is scheduled for, say, 1:30 PM, there will also be 6-12 other people there for their hearings in that same 1:30-2:00 block.
So what happens if you miss your 341 Meeting entirely?
If you have a well-regarded Michigan bankruptcy attorney representing you, the Chapter 7 or Chapter 13 Trustee will generally agree to adjourn the 341 Meeting to allow you another shot to show up.
Beyond that, you are likely to find your bankruptcy case dismissed if you don’t show up for the 341 Meeting without any advance explanation or court-ordered prior adjournment.
If you show up late, the possible consequences are as follows:
- You’ll end up last on your 30-minute docket as the Trustee calls everyone else first.
- You may be last on the next docket if you show up really late.
- You won’t hear whatever valuable information your bankruptcy attorney would have told had you shown up early as instructed.
- You’ll find yourself questioned by a potentially irritated and more hostile Trustee.
- You run the risk of just being adjourned.
If your 341 Meeting is adjourned, that means another trip to court, including parking cost, gas cost, time off from work, and a prolonged bankruptcy process.
In a Chapter 13 bankruptcy, the 341 Meeting is only the first of at least two hearings. Adjournments are more carefully allowed as the entire case timeline is impacted.
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Not Bringing Your Driver’s License & Social Security Card
You will be required to prove you are who you say you are at your 341 Meeting of Creditors. One of the first things your Trustee will require from you is your Michigan driver’s license (or other government picture ID) and your Social Security Card.
One of the most common sights for any regular attendee of Detroit-areas 341 Meetings of Creditors is the appearance of debtors who are attempting to DIY their bankruptcy cases without required identification.
If you don’t have your Social Security Card when you sit down across from the Trustee, your hearing will be adjourned, dead stop.
A good lawyer will have warned you of this well in advance of your hearing date.
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Not Having Provided Complete Documentation to Your Lawyer Ahead of Time
In order to have drafted and filed your Chapter 7 or Chapter 13 bankruptcy petition, your attorney will have requested a profuse amount of documentation to prepare your bankruptcy petition, from you ahead of time.
This will have included income documentation, bank statements, tax returns, copies of mortgages, real estate deeds, vehicle titles, retirement account statements, and more.
There is almost never any reason why or how your attorney should have or could have properly drafted and filed your petition without this documentation. Leaving that aside, however, a huge percentage of the documentation of this sort must be turned over to your Chapter 7 or Chapter 13 Trustee well in advance of your 341 Meeting of Creditors.
If the Chapter 7 or Chapter 13 Trustee does not have the documentation required to have been turned over prior to the date of the hearing, your hearing again may be adjourned.
If it is not fully adjourned, the 341 Meeting will be “continued.” That is, it will not be concluded on the record, allowing your bankruptcy process to move forward, until the missing documentation is turned over and reviewed by the Trustee.
Your 341 Meeting of Creditors should only last 10 minutes—if nothing is missing and your situation is not unusually over-complicated with business ownership and other entanglements (some are, unavoidably).
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Not Knowing What Is In Your Bankruptcy Petition
Why would you not know what is in your bankruptcy petition?
The main reason would be that you didn’t fill out your bankruptcy lawyer’s questionnaire and other paperwork or compile the documentation yourself. You had your spouse do it. Or your mother. Or an unlicensed and usually illegal “bankruptcy petition preparer.”
If the Chapter 7 or Chapter 13 Trustee starts asking you questions at your 341 Meeting and you don’t know the answers or don’t appear to understand what you filed or what that paperwork discloses, your case is going to go downhill fast.
Did you sign the petition when your attorney asked you to? Did you read it first? Carefully?
Again, this is your bankruptcy process and not anyone else’s.
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Not Disclosing—Anything
Failure to disclose assets or income in your filed (and signed) bankruptcy petition is perjury. Doing it willfully is a Federal felony crime that can land you in jail for 5 years.
What about a mistake? Details do slip through cracks, naturally.
If you arrive at your 341 Meeting knowing that something false or incomplete was filed in your case, it is your responsibility to let your bankruptcy attorney know about it (or the Trustee directly, if you are unrepresented by counsel).
Your petition, schedules, or statements must immediately be amended to correct the deficiency. You must disclose this need “on the record” (i.e., with tape recorder running). If you do not do so, this failure can be construed as willfulness later on.
Willfulness is line between “Whoops, I made a mistake” and “See you in 5 years, Mom.”
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Lying—About Anything
Here is a Bonus #6 Top 341 Meeting of Creditors Mistake: lying. Otherwise known as perjury. You will, the moment you sit down in front of your Trustee, be sworn in, under oath.
Failing to truthfully answer any question or failing to completely answer any question posed to you by a Trustee or a creditor can make a bigger problem for you than mere debt.
If there is a legal answer or strategic answer to be offered in response to a question, that is a conversation to have with your bankruptcy lawyer ahead of time.
Short of following specific instructions from your attorney, your obligation is to answer questions at your 341 Meeting of Creditors—honestly.
Top 5 341 Meeting of Creditors Mistakes: The Bottom Line
The bottom line is that the 341 Meeting of Creditors can go very smoothly—or less smoothly.
The difference is often hiring the right bankruptcy attorney to represent you. The right bankruptcy attorney offers a balance of experience and customer service and is known and respected by all of the Chapter 7 and Chapter 13 Trustees in Michigan.
Attorney Walter Metzen is a Board Certified Bankruptcy Expert who has successfully represented Chapter 7 and Chapter 13 clients in Metro Detroit for over 30 years.
If you are considering filing for bankruptcy in southeastern Michigan, contact us now to schedule your initial consultation.
Attorney Walter Metzen is a Board Certified Bankruptcy Expert who has successfully represented Chapter 7 and Chapter 13 clients in Metro Detroit for over 30 years.
