The Cassidy Law Firm Blog

Tuesday, March 18, 2014

Bankruptcy in Monmouth County: What Is a 341 Hearing?

Over the last several years the number of bankruptcy petitions filed across the United States has reached historic levels due, in large part, to the recession the country has suffered through. If you are one of the millions of people who has been adversely affected by the economic downturn, bankruptcy may be your best long-term solution as well. For a debtor who has never been through the bankruptcy process it can be confusing and a bit intimidating. Knowing what to expect can help. Though every bankruptcy is as individual as the debtor filing the bankruptcy, there are some common steps that most debtors go through. For example, all debtors in Monmouth County and throughout New Jersey will need to attend a “341 Hearing”, often referred to as a “meeting of creditors”.

The first step in any bankruptcy in Monmouth County is to file the petition for bankruptcy. When you file your petition you must also include a schedule of creditors. Once your petition has been filed the judge will enter an automatic stay which prevent all listed creditors from continuing or initiating any attempts at collecting on the debt you owe. The court will set your meeting of creditors for between 21 and 40 days after filing the petition if you file a chapter 7 bankruptcy. If you file a chapter 13 bankruptcy the 341hearing will be set for 21 to 50 days after filing the pre-petition.

The purpose of the 341 hearing is to provide the bankruptcy trustee as well as creditors the opportunity to question you about your petition, debts, assets, and your income. The meeting is typically held at the trustee’s office or at an empty room in the courthouse. It is not usually held in a courtroom and the bankruptcy judge is not typically present.

If you filed a chapter 7 bankruptcy in Monmouth County there is a good chance that your creditors will elect not to attend the meeting. The reason for this is that a chapter 7 bankruptcy is intended for low income debtors, meaning the debtor likely has very little by way of assets and income. While it is more likely for creditors to show up in a chapter 13 bankruptcy it is still common for them to decide not to attend.

Even if all of your creditors decide not to attend the 341 hearing you will still be questioned by the trustee. These questions are customarily aimed only at confirming who you are and that the petition is true and accurate. Unless an objection by a creditor is filed, a chapter 7 bankruptcy is usually discharged within 60 days after the meeting of creditors.

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