In most cases, the only time you will have to go to “court” when filing bankruptcy is for the 341 meeting. Sometimes clients are nervous about attending the 341 meeting or “first meeting with creditors”. But as a Utah bankruptcy lawyer, I want to tell you that there is nothing to be afraid of! (Unless, of course, you are committing fraud – in which case you should be very nervous because if you are caught you will be charged with a felony!)
Your Utah bankruptcy lawyer should demystify the 341 meeting for you.
As the old G.I. Joe cartoons tell us, “knowing is half the battle”. Aside from legal expertise, one of the main functions of hiring an attorney is that they’ve been through the bankruptcy process, and they can tell you what to expect. A little advice about what to expect can go a long way to calm a client’s 341 nerves.
There are a number of reasons that people get nervous during 341 meetings. First of all, in Utah as in all other states, the meetings are held in a room with a bunch of other debtors, their bankruptcy attorneys, the trustee, and any creditors who might wish to attend. That means that you will find yourself conducting a meeting involving your embarrassing personal financial situation in front of a room full of 20-30 strangers. It is normal for you to be nervous about this, and it is unfortunate that this is how the trustee’s office conducts the meetings. I try to tell my clients to remember that everyone in the room is there for the same reason as they are, and also, that everyone is too bored to really be listening to your meeting. In fact, 341 Meetings in Utah are conducted in a room large enough that you really have to be listening closely and sitting way up front to hear much of what is said.
Another reason that clients may be nervous about the 341 meeting is that the meetings are recorded under oath, and the trustee will ask the debtor very serious and pointed questions about their truthfulness. Often the trustee asking the questions is a little gruff, so it is normal for debtors to feel as though they are suspected of committing fraud. Especially when the trustee is being short with them and asking the same pointed question over and over again. I always try to explain to my clients that, while the trustee certainly has no interest in making friends with them, he or she is not singling them out. It is the trustee’s job to root out fraud and to protect your creditor’s interests. Some trustees are better than others at walking the thin line of accomplishing these goals while remaining polite and respectful. Some are even able to lighten the mood of the meeting with a few well placed jokes. But in any case, don’t take the trustee’s accusatory demeanor personally – he or she is merely doing their job.
Three steps to a pain-free 341 Meeting
I’ve been telling you that there is nothing to worry about with your 341 meeting, which is true. But in the interest of full-disclosure, I need to tell you that 341 meetings can turn sideways and get ugly quick if you don’t know what you’re doing. I have seen debtors cry while being grilled by an angry trustee…on many occasions. Here’s three simple steps, and one “not-to-do” to make sure this doesn’t happen to you.
STEP ONE: Submit the required documents to your bankruptcy lawyer on time.
The trustee will require some documents from you before you attend the meeting. The bottom line is that most of these documents can be produced at the meeting, or even after the meeting – but this is not the way to make the trustee’s life easier, and is therefore, not the way to make your 341 meeting go smoothly. The documents required are easy enough to obtain, and you will have plenty of time to obtain them, so don’t be late!
STEP TWO: have your identification and social security card out and ready when the trustee calls your name.
341 Meetings can go like clock work if everyone is ready. Don’t be the one holding everything up!
STEP THREE: answer each question truthfully, clearly and confidently.
This is the most important step. I frequently see 341 meetings go south when a trustee asks a very straightforward question, and the debtor flounders in his or her response. Part of the trustee’s job is to protect creditors and root out bankruptcy fraud. So it’s easy to understand that if a debtor looks hesitant, the trustee is more likely to become suspicious. It’s also easy to understand how a debtor can misunderstand a question and become unsure of themselves. When this happens, the trustee’s questions become forceful, making the debtor more nervous, and a downward spiral occurs. This is where debtors are brought to tears, and there is no need for it! I have been in many 341 meetings, and I believe that 99% of the time when this sort of thing happens, it has nothing to do with the debtor being dishonest. It is just that the debtor becomes very nervous, and hesitates in trying to answer the trustee’s question completely and honestly.
When you are in your 341 meeting, remain calm and focus carefully on the trustee’s question. Do not attempt to answer quickly, instead, stop and consider the question before answering. Then, when you answer, answer confidently and unequivocally. If you don’t understand the question, ask for clarification. If you do this, your meeting will be a piece of cake.
Whatever you do, DON’T:
- Be rude to the trustee
- use verbal fillers: umm, err, hmm
- elaborate – be honest and complete in your answer, but don’t tell your life story and how it relates to every piece of property you’ve ever owned
- mumble, or speak quietly
- look away from the trustee when you are speaking to them
- LIE. Don’t ever lie to the trustee – there are serious criminal consequences!
Call us if you’re nervous about your 341 Meeting, or if you have some other question about bankruptcy!