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QUESTIONS THE TRUSTEE IS REQUIRED TO ASK YOU AT YOUR BANKRUPTCY HEARING (341(a) MEETING OF CREDITORS)
The following is a list of typical questions that the bankruptcy trustee is likely to ask a debtor at the 341 Meeting of Creditors. If you have any questions or concerns about answering any of these questions and you are a client or are considering becoming a client, please contact the Law Office of Steven J. Bracci, PA at (239) 596-2635. 2. Please provide your picture ID and social security number card for review. a. If the documents are in agreement with the § 341(a) meeting notice, a suggested statement for the record is: “I have viewed the original state of ________ drivers license (or other type of original photo ID) and original social security card (or other original document used for proof) and they match the name and social security number on the § 341 (a) meeting notice.” b. If the documents are not in agreement with the 341(a) meeting notice, a suggested statement for the record is: “I have viewed the original social security card (or other original document used for proof) and the number does not match the number on the § 341(a) meeting notice. I have instructed the debtor (or debtor’s counsel) to submit to the court an amended verified statement by [date], with notice of the correct number to all creditors, the United States Trustee, and the trustee, and to file with the court a redacted copy of the notice, showing only the last four digits of the social security number, and a certificate of service.” c. When the documents do not match the petition, the trustee shall attempt to ascertain why, and shall report the matter to the United States Trustee. d. If the debtor did not bring proof of identity and social security number, the trustee shall determine why. 3. Did you sign the petition, schedules, statements, and related documents and is the signature your own? Did you read the petition, schedules, statements, and related documents before you signed them? 4. Are you personally familiar with the information contained in the petition, schedules, statements and related documents? To the best of your knowledge, is the information contained in the petition, schedules, statements, and related documents true and correct? Are there any errors or omissions to bring to my attention at this time? 5. Are all of your assets identified on the schedules? Have you listed all of your creditors on the schedules? 6. Have you previously filed bankruptcy? (If so, the trustee must obtain the case number and the discharge information to determine the debtor(s) discharge eligibility.) 7. What is the address of your current employer? 8. Is the copy of the tax return you provided a true copy of the most recent tax return you filed? 9. Do you have a domestic support obligation? To whom? Please provide to me the claimant’s address and telephone number, but do not state it on the record. 10. Have you read the Bankruptcy Information Sheet provided by the United States Trustee? SAMPLE GENERAL QUESTIONS (To be asked when deemed appropriate.) 1. Do you own or have any interest whatsoever in any real estate? If owned: When did you purchase the property? How much did the property cost? What are the mortgages encumbering it? What do you estimate the present value of the property to be? Is that the whole value or your share? How did you arrive at that value? If renting: Have you ever owned the property in which you live and/or is its owner in any way related to you? 2. Have you made any transfers of any property or given any property away within the last one year period (or such longer period as applicable under state law)? If yes: What did you transfer? To whom was it transferred? What did you receive in exchange? What did you do with the funds? 3. Does anyone hold property belonging to you? If yes: Who holds the property and what is it? What is its value? 4. Do you have a claim against anyone or any business? If there are large medical debts, are the medical bills from injury? 5. Are you entitled to life insurance proceeds or an inheritance as a result of someone’s death? If yes: Please explain the details. If you become a beneficiary of anyone’s estate within six months of the date your bankruptcy petition was filed, the trustee must be advised within ten days through your counsel of the nature and extent of the property you will receive. FRBP 1007(h) 6. Does anyone owe you money? If yes: Is the money collectible? Why haven’t you collected it? Who owes the money and where are they? 7. Have you made any large payments, over $600, to anyone in the past year? 8. Were federal income tax returns filed on a timely basis? When was the last return filed? Do you have copies of the federal income tax returns? At the time of the filing of your petition, were you entitled to a tax refund from the federal or state government? If yes: Inquire as to amounts. 9. Do you have a bank account, either checking or savings? If yes: In what banks and what were the balances as of the date you filed your petition? 10. When you filed your petition, did you have: a. any cash on hand? 11. Do you own an automobile? If yes: What is the year, make, and value? Do you owe any money on it? Is it insured? 12. Are you the owner of any cash value life insurance policies? If yes: State the name of the company, face amount of the policy, cash surrender value, if any, and the beneficiaries. 13. Do you have any winning lottery tickets? 14. Do you anticipate that you might realize any property, cash or otherwise, as a result of a divorce or separation proceeding? 15. Regarding any consumer debts secured by your property, have you filed the required Statement of Intention with respect to the exemption, retention, or surrender of that secured property? Please provide a copy of the statement to the trustee. Have you performed that intention? 16. Have you been engaged in any business during the last six years? If yes: Where and when? What happened to the assets of the business? In cases where debtors are engaged in business, the following questions should be considered: 1. Who was responsible for maintaining financial records? 2. Which of the following records were maintained? a. Cash receipts journal 3. Where are each of the foregoing records now located? 4. Who was responsible for preparing financial statements? 5. How often were financial statements prepared? 6. For what periods are financial statements available? 7. Where are such financial statements now located? 8. Was the business on a calendar year or a fiscal year? 9. Were federal income tax returns filed on a timely basis? When was the last return filed? 10. Do you have copies of the federal income tax returns? Who does have the copies? 11. What outside accountants were employed within the last three years? 12. Do you have copies of the reports of such accountants? Who does have copies? 13. What bank accounts were maintained within the last three years? 14. Where are the bank statements and canceled checks now located? 15. What insurance policies were in effect within the last year? What kind, and why? 16. From whom can copies of such insurance policies be obtained? 17. If the business is incorporated, where are the corporate minutes? 18. Is the debtor owed any outstanding accounts receivable? From whom? Are they collectible? 19. Is there any inventory, property, or equipment remaining? Chapter 13 Frequently Asked Questions 1. What is a Chapter 13 Case?
Chapter 13 is the chapter under the Bankruptcy Code which allows a person to repay all or apportion of his or her debt under the protection of the bankruptcy court. 2. How does a chapter 13 differ from a chapter 7? The basic difference is that in a Chapter 7 case the debtor’s nonexempt property is liquidated to pay as much as possible of the debts, while in a Chapter 13 a portion of the debtor’s future income is used top pay as much of the debt as is feasible. 3. When is chapter 13 preferable over a chapter 7? Chapter 13 is usually preferable for a person who: a. wishes to repay all or most of his or her unsecured debts and has the income with which to do so within a reasonable time, b. has valuable nonexempt property or has valuable exempt property securing debts, either of which would be lost in a Chapter 7, c. has sufficient assets with which to pay most debts, but needs temporary relief from creditors in order to do so. 4. How does a chapter 13 differ from a provate debt copnsolidation? In a Chapter 13 case, the bankruptcy court can provide relief to the debtor that a private debt relief consolidation service cannot. The court can stop creditors from foreclosing or attaching the debtor’s property and can force unsecured creditors to accept a Chapter 13 plan. 5. What is a chapter 13 discharge? It is a court order releasing a debtor from all of his or her debts and ordering creditors not to collect from the debtor. There are two types of Chapter 13 discharges: a. a full or successful plan discharge, or b. partial or unsuccessful plan discharge. 6. What is a chapter 13 plan? It is a written plan presented to the bankruptcy court by a debtor that states how much money or property the debtor will pay to the Chapter 13 trustee, how long the debtor’s payments to the trustee will continue, how much will be paid to each creditor, and certain other matters. 7. What is a chapter 13 trustee? A Chapter 13 trustee is a person appointed by the United States trustee to collect payments from the debtor, make payments to creditors in the manner set forth in the debtor’s plan and administer the debtor’s Chapter 13 case until it is closed. 8. Must all debts be paid in full under a chapter 13? While priority debts, such as domestic support obligations and taxes, and fully secured debts must be paid in full, only the amount that the debtor can reasonably afford must be paid on most debts. The unpaid balances of most debts are discharged upon the completion of the plan. 9. How much of a debtor’s income must be paid? Usually all of the disposable income of the debtor and the debtor’s spouse for a 3 or 5 year period must be paid to the Chapter 13 trustee. Disposable income is income received by the debtor and his or her spouse that is not deemed to be necessary for the support of the debtor and his or her spouse. 10. When do payments begin? The debtor must begin making payments to the Chapter 13 trustee within 30 days after the Chapter 13 case is filed with the court. 11. How long does a chpater 13 plan last? A Chapter 13 plan must last for at least three years, unless all debts can be paid off in full in less time. A Chapter 13 plan cannot last for more than five years. 12. How are co-signed or guaranteed debts handled? If a co-signed or guaranteed consumer debt is being paid in full under a Chapter 13 plan, the creditor may not collect the debt from the co-signer or guarantor. However, if the debt is not being paid in full under the plan, the creditor may collect the unpaid portion of the debt from the co-signer or guarantor. 13. Who can file a chapter 13 case? Any individual is eligible to file a Chapter 13 case if he or she: a. resides in, does business in, or owns property in the United States, b. has regular income, c. has unsecured debt of less than $336,900.00, d. has secured debt of less than $1,010,650.00 e. has not intentionally dismissed another bankruptcy case within the last 180 days, and f. has received a briefing from an approved credit counseling agency within the last 180 days. 14. May a husband and wife file a joint case? A husband and wife may file a joint Chapter 13 is each of them meets the requirements above. If both spouses are liable for any significant debts, they should file a joint Chapter 13, even if only one of them has income. If both of them have regular income they should file a joint case. 15. May a self empolyed person file a chapter 13 case? A self-employed person meeting the eligibility requirements may file a Chapter 13. The debtor engaged in business may continue to operate the business during his or her Chapter 13. 16. May a chapter 7 be converted to a chapter 13 case? An existing Chapter 7 may be converted to a Chapter 13 at any time at the request of the debtor if the case has not previously been converted from a Chapter 13 to a Chapter 7. 17. What fees are charged in a chapter 13 case? There is a $274.00 filing fee charged when the case is filed. In some cases, it may be deferred and paid over time as part of your repayment plan. In addition the Chapter 13 trustee assesses a fee of 10 percent on all payments made by the debtor under the plan. 18. Will a person lose property in a chapter 13 case? Usually the debtor will not lose property. Creditors are paid out of the debtor’s income and not from the debtor’s property. However there can be instances where debtor’s property will be sold to pay creditors. 19. How does filing affect collection proceedings? The filing of a Chapter 13 case automatically stays or stops all lawsuits, attachments, garnishments, foreclosures and other action by creditors. A few days after the case is filed a notice will be mailed to the creditors advising them of the automatic stay. 20. May a person whoes debts are being administerd by a financial counselor file? A financial counselor has no legal authority to prevent a person from filing any type of bankruptcy case, including a Chapter 13. 21. How does filing a chapter 13 affect a person credit rating? In many case the filing of a Chapter 13 will worsen a debtor’s credit rating. However if most of the person’s debt is ultimately paid off under the plan, credit reporting agencies may take that fact into account. 22. When does a debtor appear in court? Most debtors’ have to appear in court at least twice: Once is for a hearing called the 341 creditors and once for the confirmation of the Chapter 13 plan. The confirmation hearing could be on the same day as the 341 meeting of creditors. 23. What if the court does not approve the debtor’s plan? If the court will not approve the plan initially proposed by a debtor, the debtor may modify the plan and seek court approval of the modified plan. Chapter 7 Frequently Asked Questions 1. What is a chapter 7 bankruptcy case and how does it work? A chapter 7 bankruptcy is a proceeding under federal law in which the debtor seeks relief under the bankruptcy code. In a Chapter 7, the debtor must turn his or her non-exempt property, if there is any, over to a trustee, who then converts the property to cash and pays the debtor’s creditors. 2. What is a chapter 7 discharge? It is a court order releasing a debtor from all of his or her dischargeable debts and ordering the creditors not to attempt to collect them from the debtor. A debt that is discharged is a debt that the debtor is released from and does not have to pay. However, not all debts are discharged by a Chapter 7 discharge. 3. Who is permitted to file a chapter 7? Any person who resides in, does business in, or has property in the United States is permitted to file Chapter 7 except a person who has intentionally dismissed a prior bankruptcy case within the last 180 days. To be permitted to maintain a Chapter 7 a person must qualify for relief under a process called means testing. 4. What is means testing? Means testing determines a person’s eligibility to file a Chapter 7. Under this method a person must show that he or she is not able to pay a minimum of $100.00 per month for 60 months to his or her unsecured creditors from his or her disposable monthly income. If a person is able to pay $100.00 per month or more to unsecured creditors for 60 months the Chapter 7 may be dismissed or converted to a Chapter 13. 5. What types of debt are not dischargeable? All debts may be dischargeable except for those types of debts that are nondischargeable by law. Below are just some of the debts that are not dischargeable: a. Most tax debts and debts that were incurred to pay nondischargeable federal tax debts. b. Debts for domestic support obligations, which may include debts for alimony, maintenance, or support and certain other divorce related debts, including property settlement debts. c. Debts for certain fines or penalties. d. Debts for most educational benefits and student loans. e. Debts for personal injury or death caused by the debtor’s operation of a vehicle while intoxicated. 6. Is there anything that a person must do before filing? A person is not permitted to file a Chapter 7 unless he or she has, during the 180 day period prior to filing, received from an approved budget and credit counseling agency an individual briefing that outlined the opportunities for available credit counseling and assisted the person in performing a budget analysis. 7. How much is the filing fee? The filing fee is $29.00 for either a single or joint case. The filing fee is payable when the case is filed. 8. May a husband and wife file jointly? A husband and wife may file a joint case under Chapter 7. However, both husband and wife must receive the required credit counseling before the case is filed and both must complete the required financial management course after the case is filed. A husband and wife should file a joint Chapter 7 if both of them are liable for one or more significant dischargeable debts. If only one spouse files, a creditor may later attempt to collect the debt from the nonfiling spouse. 9. How does filing affect collection proceedings in progress? The filing of the case automatically suspends virtually all collection proceedings pending against that person. A few days after a case is filed the court will mail a notice to all creditors ordering them to refrain from any further action against the person. This is called the “automatic stay”. Criminal proceedings and child support or domestic support actions are not affected by the automatic stay. 10. How does filing a chapter 7 affect a person’s credit rating? Filing will usually worsen your credit rating. However, some financial institutions openly solicit business from person who have filed because it will be at least 8 years before the person can file another Chapter 7. 11. Will a person lose all of his or her property when they file? Normally a person will not lose all their property. Certain property is exempt and may not be taken by creditors. A person may also be allowed to keep other encumbered exempt property. Encumbered property is property against which a creditor has a valid lien. 12. What is exempt property? Exempt property is property that is protected by law from the claims of creditors. However, if exempt property has been pledged to secure a debt, the lien or mortgage holder may claim the exempt property by foreclosing on the mortgage. Your attorney can advise you in these matters. 13. When must a person apear in court and what happens? The first court appearance is for a hearing called the “meeting of creditors”. This is usually held about a month after the case is filed. The person filing the case must bring photo identification, his or her social security card, his or her most recent pay stub and all of his or her bank and investment account statements to the hearing. At this hearing the person is put under oath and questioned about his or her debts, assets, income and expense by the hearing officer or trustee. The trustee is a person appointed by the United States Trustee’s Office to examine the person who filed the case, collect the person’s nonexempt property, and pay the expenses of the estate and the claims of the creditors. 14. What if there are no assets? If there are no nonexempt assets, a notice will be sent to the creditors advising them that there appear to be no nonexempt assets from which to pay creditors, that it is unnecessary for them to file claims, and that if assets are later recovered, they will be given an opportunity to file claims. This is a no asset case. 15. How are secured creditors dealt with? Secured creditors are creditors with valid mortgages or liens. A secured creditor is usually permitted to repossess or foreclose on its secured property, unless the value of the secured property greatly exceeds the amount owed to the creditor. 16. How are unsecured creditors dealt with? An unsecured creditor is a person without a valid lien. If the person filing has nonexempt assets, unsecured creditors may file claims with the court within 90 days after the first date set for the 341 meeting of creditors. 17. May a utility company refuse to provide service? If within 20 days after a case is filed, the person filing the case furnishes a utility company with a deposit to insure the payment of future utility services, it is illegal for a utility company to refuse to provide services to the person after the case is filed, even if its bill for past services is discharged. 18. How does fiing affect cosigners? A Chapter 7 discharge releases on the person who filed. The liability of any other party on a debt is not affected by the filing. Therefore a person who has cosigned or guaranteed a debt is still liable for the debt. 19. Will I be able to keep my car? In many instances you will be able to keep your car. It may be exempt property or it may have a lien against it. Depending on the value of the car and the nature of the lien you may be able to make an agreement that will allow you to keep you vehicle. Your attorney can help you. 20. Will I be able to keep my house? Many houses have certain exempt values. These coupled with the security or lien interest may allow you to keep you house. Much depends on the status of the payments and the nature of the security. You should immediately seek the advice of counsel to determine what to do. |
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