After someone files a Chapter 7 or a Chapter 13 bankruptcy, the person will be required to attend a brief hearing called a Section 341 Meeting of Creditors. Bankruptcy professionals refer to this hearing as a "341 hearing." Consult with a bankruptcy attorney for help.
The 341 hearing is held between 30 and 45 days after a debtor files and it will last about 5 to 10 minutes. At the hearing, the trustee asks a series of questions on any updates to the debtor's petition, such as whether the debtor has lost his job, whether he has filed any lawsuits, whether he has married. The trustee will ask the debtor to raise his/her right hand and take an oath stating that what he/she are about to say is the truth, the whole truth, and nothing but the truth under the penalty of perjury. Failing to tell the truth is a criminal offense. Perjury is investigated and prosecuted by the FBI and the U.S. Attorney. If the debtor does not speak English, he/she should make arrangements for a translator ahead of time.
At the hearing, the debtor has to bring a social security card and photo ID to prove that he/she is the debtor and that his/her information matches what is on the petition. If the person forgets to bring the identification, he/she may be required to return in person with the information.
The hearing is recorded. Nothing final happens at the 341 hearing. Sometimes, there maybe missing information requested from the trustee, such as a review of tax filings or proof on wages earned. The debtor is required to read an information sheet on bankruptcy proceedings, and given instructions on a required education course on finances.
After the 341 hearing, the trustee determines whether there are assets that may be liquidated to pay the debtor's creditors. If there are assets to be liquidated to pay creditors, the creditors are paid based upon their priority established by the Bankruptcy Code on a pro rata basis. If there are no assets, the trustee files what is called a "no asset report" and no creditors receive payments.
Find a bankruptcy attorney who will be an ally in counseling on bankruptcy proceedings to make the process less intimidating.
