New Jersey Bankruptcy 341 Hearing
If you have filed for bankruptcy under either Chapter 7 or Chapter 13, a New Jersey bankruptcy 341 hearing will be required in order to give the bankruptcy trustee an opportunity to evaluate your case. Your creditors may attend the meeting, but often will not, and no judge will be present.
Many 341 hearings are very brief, but it is still important to make sure that you have adequately prepared for the meeting. An experienced bankruptcy attorney can help you understand what to expect in the hearing and why the 341 hearing is important.
What Happens During a Section 341 Hearing?
The bankruptcy 341 hearing, or meeting, gets its name from Section 341 of the Bankruptcy Code. It is a requirement for debtors who have filed under Chapter 7 or Chapter 13. The debtor will be sworn in by the bankruptcy trustee, even though no judge is present and the meeting will not take place in a courtroom. This means that the debtor is required to answer all questions under oath, so it is very important to answer truthfully.
It is mandatory that the debtor attend the 341 hearing, and if a joint petition has been filed, any other interested parties, such as the debtor’s spouse or business partner, must also attend. During the hearing, the trustee will ask a series of questions. Common questions include:
- Whether all submitted documents are true and correct,
- Whether all assets, income and debts are listed in the bankruptcy filing,
- How the debtor arrived at any given asset value,
- Whether the debtor has any additional legal claims against another party that may allow for monetary recovery,
- If anyone else is holding valuable property that actually belongs to the debtor, and
- Whether the debtor has transferred any assets or cash recently.
While creditors are invited to attend the meeting, they generally will not. If creditors do attend, they will ask questions about transactions specific to their debt, such as whether any recent cash advances were made while the debtor knew they could not repay them. Secured creditors who attend will usually ask whether the debtor intends to reaffirm their intention to pay the debt through a reaffirmation agreement.
What is the Trustee’s Role?
The trustee presides over the New Jersey bankruptcy 341 hearing. The purpose of the trustee’s questions is to clarify any information that has been provided and ascertain whether any additional assets may be available to satisfy the creditors’ claims.
It is important to remember that while the trustee may be a lawyer, they are not the debtor’s lawyer. It is the trustee’s responsibility to ensure that the debtor’s statements regarding their assets and debts are complete and accurate to provide maximum repayment to creditors and whether the debtor’s income is such that a Chapter 13 repayment plan is reasonable and fair.
How a New Jersey Bankruptcy Attorney Can Help with a 341 Hearing
Although New Jersey bankruptcy 341 hearings usually only lasts five to ten minutes, it can be one of the more stressful aspects of a bankruptcy filing. A bankruptcy lawyer will work with you to help you understand the process so that you can anticipate some of the questions that the trustee may ask.
Because failure to attend the 341 hearing will result in an automatic dismissal of your bankruptcy case, the advice of an experienced lawyer can be valuable in helping to ease any anxiety that you might be feeling in advance of the hearing.