Do I have to go to Court if I File Bankruptcy?

If you are thinking of filing bankruptcy, then you will have to go to court. To complete your bankruptcy case and get a discharge, every individual who files for bankruptcy has to go to court and attend a 341 meeting of creditors. While court can be a scary, having a bankruptcy lawyer by your side can make the process much easier.

What Happens at Bankruptcy Court?

When you go to your bankruptcy hearing, you will be required to answer questions regarding your bankruptcy petition. At the 341 meeting of creditor’s a trustee will ask questions about your financial situation. The trustee represents your creditors to ensure that you are not hiding assets. The trustee wants to ensure that you are familiar with the petition that you submitted and are testifying under oath that everything is true and correct.

The first thing you will notice when you enter the 341-meeting room is that everyone there is filing for bankruptcy. While you wait for your name to be called, you will need to familiarize yourself with the bankruptcy information sheet. The trustee will ask for you to provide proof of your identity and social security. This means you will need to have your social security card and photo ID at the hearing.

It is important to note that since the pandemic, many of these hearings are now being conducted over the phone or through Zoom.

Before you begin your hearing, you will be sworn in under oath. This means that you are testifying that everything is true and correct. Keep in mind, if you lie or fail to disclose assets, this can lead you into some serious trouble. Lying on a bankruptcy petition is a federal crime and you could end up in jail.

The trustee can ask you anything about your finances, assets, and what you listed on the petition. Having a bankruptcy lawyer next to you at this hearing can make for a much smoother process. Generally, a lawyer will send all of the required paperwork beforehand so that the trustee has it before the meeting. If you fail to give the trustee the required paperwork, the trustee can adjourn or dismiss your case.

What Can go Wrong at the Bankruptcy Hearing?

While the bankruptcy hearing can seem straight forward, many times when people file bankruptcy pro se they end up in a worse position. When you file for bankruptcy, there are certain exemptions that can be used to save property. Using the wrong exemptions, can be a big mistake and people can end up losing their property filing alone. In this New York case, a pro se filer almost lose his apartment building because he didn’t hire a lawyer to help him and filed the wrong type of bankruptcy.

Further, there are certain documents that the trustee needs before the hearing to ensure that your case goes smoothly. A bankruptcy lawyer can gather all the required documents to ensure that your case won’t be dismissed.

How Do Telephonic Hearings work?

Due to the pandemic, the hearings are now being conducted over the phone. However, this doesn’t make the bankruptcy meetings any easier. Aside from less travel time, you will still be required to be ready for your hearing. You will still testify under oath and the trustee will still require that all documents be submitted before the hearing.

What Types of Bankruptcy Hearings Are there? 

Depending on the bankruptcy chapter that you file, there are different hearings that you may have to attend. Below we will discuss each of the different hearings that you may have to attend:

341 Meeting of Creditors:

The 341 meeting of creditors is the meeting that every individual who files for bankruptcy has to attend. In this meeting, the trustee will ask questions about the petition, and you will testify under oath about your income, assets, and liabilities.

Reaffirmation Hearing:

If you want to keep your vehicle or home, then you may have to attend a reaffirmation hearing. This is a hearing with the judge where you are requesting to keep your vehicle or home after the bankruptcy has been filed with the court. You will have to show the judge why the creditor should allow you to keep your car or home and show that you have the income available to do so.

Creditor’s Motion to Be Relieved of The Stay:

In this hearing, you will have to appear in front of the judge and explain why the creditor should not be able to collect against you once you have filed for bankruptcy. Typically, a creditor will put in a motion to be relieved of the automatic stay, if they want to continue to collect against you. Generally, this happens after a bankruptcy is filed and the creditor wants to continue to repossess a car, garnish wages, or hold you accountable for the debt.

Adversary Proceeding:

An adversary proceeding is an action within the bankruptcy court. Typically, a creditor will file this action when they don’t want your debt to be discharged. This can happen when you owe friends or family, or credit cards and they don’t believe that you should get a discharge. Adversary proceedings can prolong the bankruptcy process.

While these are the most common hearings within a bankruptcy court, it is important to note that there are other hearings like confirmation hearings, status, hearings etc.

Should I Hire a Lawyer to Represent Me at the Bankruptcy Hearing:

If you are considering bankruptcy, having a lawyer represent you at the bankruptcy hearing is important. A bankruptcy lawyer will ensure that your assets are protected, they will send all of the required documentation to the trustee, and they can prepare you for the hearing. Most bankruptcy lawyers practice in front of the same trustees and judges so they know what to look out for and what needs to be done to ensure that your bankruptcy case can be successful.

Bankruptcy Court

Karra L. Kingston Esq. has helped many people get out of debt and start over. If you are thinking of filing for bankruptcy, Karra will help prepare you for the court hearing to ensure that the bankruptcy process goes smoothly.