What is a 341 Meeting?
How does a bankruptcy 341 meeting work?
What’s important to know?
In this article, I will break down 341 Meetings under the bankruptcy law so you know all there is to know about it!
Keep reading as we have gathered exactly the information that you need!
Let me explain to you what is a 341 creditors meeting and why it’s important!
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What Is A 341 Meeting
A 341 meeting in bankruptcy law refers to a meeting of the creditors where all the debtors are required to attend to answer questions relating to their assets and the administration of the bankruptcy.
The main reason why this meeting is called a “341 meeting” is that the meeting is mandated further to Section 341 of the Bankruptcy Code.
A bankruptcy 341 meeting is also called the “meeting of the creditors” as the creditors are notified of this meeting and have the right to attend to ask the bankrupt debtors questions about the case.
The bankruptcy trustee meeting under Section 341 is can take place between 21 to 50 days following the filing of the bankruptcy petition depending on if the petition is filed under Chapter 7 or 13.
Why Is A 341 Meeting Important
A 341 meeting is important as this is one of the first meetings that will be held in the context of a bankruptcy proceeding.
For a meeting under Section 341 to be legally held, you mandatorily need the presence of the debtor who has filed a bankruptcy petition along with the court-appointed trustee.
Other people can attend such as creditors, attorneys to the debtors, attorneys to creditors, and so on but their presence is not legally required for a 341 meeting to be effective.
Typically, the bankruptcy trustee will review the bankruptcy petition, review the financial records provided by the debtor, and all other information in the file prior to attending this meeting.
Then, when the bankruptcy trustee attends the meeting, his or her objective will be to ensure that the underlying facts of the case are properly understood, obtain additional information or documents from the debtor, and get a preliminary perspective of the bankruptcy case.
Very often, if the bankruptcy petition is filed fraudulently, the bankruptcy trustee may detect some irregular fact patterns before the 341 sessions or even during the meeting.
What Happens At A 341 Meeting
The main objective of a 341 meeting, or meeting of creditors, is to give an opportunity to the creditors to ask all debtors questions they may have.
The questions that the bankrupt or debtor may need to answer can relate to:
- The bankrupt’s conduct that led to the bankruptcy
- The property held by the bankrupt
- The bankrupt’s liabilities and legal obligations
- The bankrupt’s financial position
- Topics relating to the administration of the case
The questions are answered by the debtor while under oath to tell the truth, the whole truth, and nothing but the truth.
As a result, any false statements or misrepresentations can lead to perjury charges.
The bankruptcy creditors meeting is also an important moment for the United States Trustee to ask questions to the bankrupt and make sure that he or she understands the bankruptcy process.
A “341 meeting” is generally a short meeting that can last 10 to 15 minutes.
Sometimes it can last longer if creditors or the US Trustee representative have many questions.
What Happens After A 341 Meeting
Once the bankruptcy trustee and the creditors who have attended have asked their questions and gotten their answers, the 341 meeting will be adjourned.
In most bankruptcy cases, the bankrupt will not attend any court hearings or have any further dealings with the court system to the extent the bankruptcy is legally founded, legitimate, and without any particular issues.
As a result, in the majority of cases, the bankruptcy proceeding will result in the discharge of the debtor’s financial obligations after the 341 meeting.
For most debtors, once the 341 meeting is over, they come closer to seeing their debt discharged and getting the relief they were hoping to get when they filed for bankruptcy.
Do Creditors Show Up At 341 Meeting
Creditors are certainly notified that a 341 meeting is organized and have the right to attend.
If they attend, they have the right to ask the debtor any question relating to his or her financial position, assets, liabilities, and other matters that relate to the handling of the bankruptcy matter.
However, creditors are not obligated to attend a 341 creditor meeting.
If they elect not to participate in the creditors’ meeting, they will not waive any of their rights under the bankruptcy law.
Questions To Expect At A 341 Meeting
Now let’s look at some of the possible questions a bankruptcy trustee or creditors may ask during a 341 meeting.
Here are some aspects that are certain the bankruptcy trustee will cover with the debtor at a 341 meeting:
- Questions regarding your contact information
- To validate that you signed your bankruptcy petition and all related documents
- To validate that you reviewed your bankruptcy documents before signing them
- To validate that you understood and can confirm all the information disclosed in the bankruptcy petition
- To get confirmation that to the best of your knowledge, all the information you provided is true and correct
- To get confirmation that to the best of your knowledge, you have not omitted any other important information
- To validate that there are no errors in your bankruptcy petition information
- To validate that you have fully disclosed all your assets and liabilities
- To ask if you have filed a bankruptcy in the past
- To validate your current sources of income and employer information
- To validate that you have given your latest tax return
- To validate if you have any domestic support obligations or not
- To ensure you have read and understood your Bankruptcy Information Statement provided by the trustee
Here are some aspects that a bankruptcy trustee may cover with a debtor at a 341 meeting:
- If the debtor owns any real estate property
- If the debtor has transferred property to anyone within the last 12 months or even longer
- If anyone holds property that is owned by the debtor
- If the debtor has any interests in a business or company
- If the debtor is involved in any lawsuits
- If the debtor is entitled to receive any money, insurance proceeds, or other compensation
- If the debtor has made large payments to anyone over the past year (over $600)
- If the debtor expects any tax refund
- If the debtor is involved in a divorce proceeding and may get paid in some fashion
Meetings of Creditors And Equity Security Holders
What does Section 341 of the Bankruptcy Code state about the meeting of creditors and equity security holders?
In essence, 11 U.S. Code § 341 states the following:
- Section 341(a) – Within a reasonable time after the order for relief in a case under this title, the United States trustee shall convene and preside at a meeting of creditors.
- Section 341(b) – The United States trustee may convene a meeting of any equity security holders.
- Section 341(c) – The court may not preside at, and may not attend, any meeting under this section including any final meeting of creditors. Notwithstanding any local court rule, provision of a State constitution, any otherwise applicable nonbankruptcy law, or any other requirement that representation at the meeting of creditors under subsection (a) be by an attorney, a creditor holding a consumer debt or any representative of the creditor (which may include an entity or an employee of an entity and may be a representative for more than 1 creditor) shall be permitted to appear at and participate in the meeting of creditors in a case under chapter 7 or 13, either alone or in conjunction with an attorney for the creditor. Nothing in this subsection shall be construed to require any creditor to be represented by an attorney at any meeting of creditors.
- Section 341(d) – Prior to the conclusion of the meeting of creditors or equity security holders, the trustee shall orally examine the debtor to ensure that the debtor in a case under chapter 7 of this title is aware of—
- Section 341(d)(1) – the potential consequences of seeking a discharge in bankruptcy, including the effects on credit history;
- Section 341(d)(2) – the debtor’s ability to file a petition under a different chapter of this title;
- Section 341(d)(3) – the effect of receiving a discharge of debts under this title; and
- Section 341(d)(4) – the effect of reaffirming a debt, including the debtor’s knowledge of the provisions of section 524(d) of this title.
- Section 341(e) – Notwithstanding subsections (a) and (b), the court, on the request of a party in interest and after notice and a hearing, for cause may order that the United States trustee not convene a meeting of creditors or equity security holders if the debtor has filed a plan as to which the debtor solicited acceptances prior to the commencement of the case.
341 Meeting of Creditors Takeaways
So there you have it folks!
What is 341 meeting in simple terms?
How does a 341 meeting work?
A 341 meeting is a type of meeting that is mandated by Section 341 of the US Bankruptcy Code where creditors and debtors meet to discuss the case.
In most cases, the meeting takes place approximately 30 days after filing the bankruptcy petition.
It’s important to remember that a 341 meeting is not a court hearing as the law does not permit a judge to attend a meeting of creditors.
The meeting of the creditors called under Sec 341 is a serious and important meeting (although not a court hearing) where the bankruptcy trustee has the opportunity to validate the facts of the case, ask questions, get more information or documents, and so on.
For most, the 341 meetings will be the only face-to-face interaction they’ll have in the context of their bankruptcy.
Remember, this article is intended to give you general information on 341 meetings.
If you need legal advice or are dealing with bankruptcy, be sure to speak to a bankruptcy lawyer who can give you specific and qualified advice.
Now, let’s look at a summary of our findings.
Understanding A 341 Meeting
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