The Chapter 13 Meeting of Creditors - What to Expect
Article about what to expect at the Chapter 13 Bankruptcy Meeting of
bankruptcy, meeting of creditors, chapter 13 bankruptcy, filing
Have you recently filed Chapter 13 Bankruptcy? Do you have an upcoming
Meeting of Creditors hearing? Many Chapter 13 debtors get a little
nervous about the meeting since they are not exactly sure what to expect.
So, I decided to take some notes on exactly what happens during the
meeting for the benefit of those who have an upcoming meeting. Of course,
I knew what was going to happen since I've done these hearings before for
my clients, but I wanted to note the exact words this hearing officer
(trustee) was using and the exact questions she was asking. Sometimes,
clients have visions that creditors are going to sit there and hammer
them all day with questions or something. This is just not the case, in
my experience. Let's start with some basics.
<b>What is the Meeting of Creditors?</b>
The Meeting of Creditors is a hearing that is held 20 to 40 days after
the bankruptcy petition is filed. The debtor must attend this meeting, at
which creditors may appear and ask questions regarding the debtor's
financial affairs and property. If a husband and wife have filed a joint
petition, they both must attend the creditors meeting. The trustee also
will attend this meeting. It is important for the debtor to cooperate
with the trustee and to provide any financial records or documents that
the trustee requests.
The trustee is required to examine the debtor orally at the meeting of
creditors to ensure that the debtor is aware of the potential
consequences of seeking a discharge in bankruptcy, including the effect
on credit history, the ability to file a petition under a different
chapter, the effect of receiving a discharge, and the effect of
reaffirming a debt.
In some courts, trustees may provide written information on these topics
at or in advance of the meeting, to ensure that the debtor is aware of
this information. In order to preserve their independent judgment,
bankruptcy judges are prohibited from attending the meeting of creditors.
This paragraph was adapted from Bankruptcy Basics, a FREE publication,
click here to get a copy.
<b>What Can You Expect at the Meeting? </b>
Well, that's what this article is all about. Let's talk about that:
If you have an upcoming meeting of creditors hearing, the best way to
overcome your fear of the unknown is simply to go to a meeting(before
yours) and just sit there and observe. That will probably prepare you
much more than if you learn about it second hand.
So what I've tried to do is give you blow by blow of what happened at
this particular meeting of creditors about a week ago (December, 2005). I
primarily practice Bankruptcy in the Northern District of California,
although I can practice anywhere in California.
Disclaimer: The following is an example of what occurred on a particular
date in my jurisdiction (Northern District of California, Oakland
Division) at a Chapter 13 Meeting of Creditors hearing in December, 2005.
This may vary dramatically from what occurs where you live. Therefore, do
not think that the way the meeting is presented above reflects what will
occur in your jurisdiction. You should speak to your attorney about what
occurs in your particular jurisdiction. This article is for informational
purposes only and does not constitute legal advice.
That having been said, in the Oakland Division of the Northern District
of California Bankruptcy court, the meetings are held at a location other
than the actual Bankruptcy court. The court itself is across the street.
The meetings are held in a suite on the 6th floor of the Federal
Building. Inside the suite, there are two main rooms. One is a waiting
room where attorneys can confer with clients, talk to each other, etc...
The other room is where the actually meeting of creditors hearing occurs.
There is usually a person there to help direct you and answer basic non-
legal questions about the process.
1. So, let's say your hearing is at 9 A.M. You get there at 8:30 or so
and go into the waiting room. The trustee in our jurisdiction hands out a
booklet called "The Chapter 13 Debtor Handbook" which is for you to take
home and read and tells all about the process. You are then directed to
watch a 15 minute video that explains the basics of bankruptcy and
particularly Chapter 13 bankruptcy.
2. Once the video is over, the trustee's assistant comes into the waiting
room and announces that the meeting is about to start and that anyone who
is on the 9 A.M. calendar should come into the room where the meeting
will be held. There are about 20 or 30 seats and all of the people on
calendar head in to the adjoining meeting room.
3. The hearing begins. Trustee starts the calendar and introduces
herself. She talks about what will occur at the meeting. The trustee
states that she will call debtors individually and that she will question
each for approximately 5 minutes. If creditors are present, they will be
able to ask questions for 5 minutes per case per debtor. The debtor is to
have their Social Security card and ID ready to show to the trustee when
their name is called. She says that all payments into the Chapter 13 plan
are to be made in cashier's check or money order. Debtors are not allowed
to incur new debt. If you absolutely need to purchase a car for
transportation, the trustee must approve how much you can spend on the
car and approves the purchase contract. You can only sell or refinance
your real property with permission of the trustee. Permission is only
given to Title companies when in escrow. In other words, the deal must be
already in place.
4. The Trustee calls the name of the first debtor. The debtor and their
attorney comes up to the table. The attorney sits on one side of the
table and the debtor on the other side. (Picture a long cafeteria-style
table. The trustee and her assistants are sitting at the middle of the
table facing the front of the room. The attorney and debtor are sitting
at the far ends of the table opposite each other).
5. The trustee asks for debtor's ID and Social Security Card.
6. The attorney states his or her appearance for the record. (e.g. "Leon
Rountree, appearing on behalf of John Doe debtor")
7. The Trustee swears in the Debtor: "Do you solemnly affirm under
penalty of perjury that the testimony that you are about to give is the
truth, the whole truth, and nothing but the truth"?
8. Trustee states for the record: "I have seen the debtor's Social
Security card and identification and Social Security number on the card
matches the number on the petition."
The trustee then asks the debtor the following questions:
9. "Is your home address still: "[Home Address]"?
10. "And do you still work at [Place of employment] as an [occupation]"?
11. If the debtor owns a car and is keeping it:
"Is your car insured"?
"Have you made the necessary car payments"?
If the debtor is not keeping the car,
"Are you surrendering the car"?
12. "Do you own any real estate"?
"Have you made all the necessary house payments since the petition
"When did you make those payments"?
"Is the house insured"?
"Do you pay the property taxes directly"?
"Are the property taxes current"?
13. "Have you filed all tax returns for the last five years"?
"When will they be filed"?
14. "Do you owe any money to the IRS or the California Franchise Tax
15. If debtor has credit card debt,
"Have you destroyed all your credit cards"?
16. "Do you believe that you can make monthly payments of [Chapter 13
payment] per month"?
17. "Did you review the bankruptcy petition and schedules before signing
18. "Is everything in the petition and schedules true and correct"?
19. Are there any creditors that wish to be heard in this matter?
If everything runs smoothly, the trustee states that she will recommend
to the Judge that the Chapter 13 plan be confirmed.
That's it! When they say that it will last about 5 minutes, they usually
mean it. The only exception might be if there are objections of some kind
to the plan or a married couple is filing in which case the meeting may
last a few minutes longer.
<b>Disclaimer: The above is an example of what occurred on a particular
date in my jurisdiction (Northern District of California, Oakland
Division) at a Chapter 13 Meeting of Creditors hearing in (December,
2005). This may vary dramatically from what occurs where you live.
Therefore, do not think that the way the meeting is presented above
reflects what will occur in your jurisdiction. You should speak to your
attorney about what occurs in your particular jurisdiction. This article
is for informational purposes only and does not constitute legal advice.
This article does not create any attorney client relationship. Copyright
2005, Leon H. Rountree III</b>