Whether you file for a Chapter 7 or Chapter 13 bankruptcy, your case will be administered by a trustee in the meeting of creditors – otherwise known as a 341 hearing. Occurring 3 to 7 weeks after the date of your filing, the meeting of creditors is an in-depth look at your bankruptcy case that will determine whether or not your debt will be discharged. Aside from examining your petition, the trustee will question you during the hearing. So what exactly should you expect?
What Does a Bankruptcy Trustee Look For?
Understanding exactly what the bankruptcy trustee is looking for will help you prepare for the 341 hearing. Furthermore, working with a bankruptcy lawyer is a guaranteed way to ensure that you’re prepared for the meeting of creditors. Not only will a Wichita Falls bankruptcy lawyer help you strengthen your petition, but he or she will also provide you with excellent advice before you’re scheduled to attend your meeting of creditors. Think of a bankruptcy lawyer as your secret weapon.
A bankruptcy trustee searches for:
- Manipulated or omitted assets. In order to have your debts discharged, you must prove that you cannot pay them or that being forced to do so would enforce an undue hardship on you. Thus, your assets will be examined to ensure that you accurately reflected your assets and their worth in your bankruptcy application.
- Undervalued income. Again, a bankruptcy revolves around your inability to pay back your debts. The trustee will ensure that your disposable income is minimal enough to pass the means test to qualify for Chapter 7. However, if your income is too high, you will have to file for a Chapter 13 bankruptcy, which will reorganize your debts. Working with a bankruptcy lawyer throughout your entire application process will likely help you avoid such concerns.
- Fraud. The trustee will review your expenses to ensure that they’re not excessive and that you’re not trying to “play” the system. Furthermore, transferring property to protect it before your bankruptcy case could be considered fraud. Thus, any recent transfers or transactions will be highly scrutinized.