What is a Meeting of Creditors?

Section 341 of the United States Bankruptcy Code affords creditors the right to meet with the debtor to determine if a discharge or a reorganization of debt is appropriate based upon the facts and circumstances presented by a debtor in their bankruptcy petition. While creditors do technically have the right to attend these proceedings and to question the debtor, creditors rarely appear at these proceedings.

In Chapter 7 bankruptcy proceeding, the Meeting of Creditors serves two important purposes. First, the Court, through examination by the Court appointed Trustee, verifies that all of the representations contained in your bankruptcy petition are true and correct to your best of your belief and knowledge. Second, the Bankruptcy Court Trustee also utilizes this meeting to verify on behalf of the Court that there are no assets that maybe considered non-exempt, which could be sold by the Trustee to repay part, or all, of your debt. A typical meeting of creditors in a Chapter 7 proceeding takes approximately 5-10 minutes to complete.

In Chapter 13 bankruptcy proceeding, a debtor is also required to appear before the Chapter 13 trustee. In a Chapter 13 case, the meeting of creditors serves a slightly different purpose. In addition to verifying that all of the representations made by a debtor are true and correct, the Chapter 13 trustee will also verify that the debtor has calculated the means test properly, and that the debtor has the financial ability with which to make the payments proposed in the proposed Chapter 13 plan.

Verification of a debtor’s ability to make payments in a Chapter 13 bankruptcy case is based upon both the debtor testimony at the meeting and various documentation, usually tax returns and/or pay statements, that must be presented to the Chapter 13 trustee to verify the representations made in your Chapter 13 petition. As in a Chapter 7 bankruptcy case, a typical meeting of creditors in Chapter 13 bankruptcy case takes between 5-10 minutes to complete.

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