Information About Debtor’s 341 Meeting of Creditors – Bankruptcy

A creditors’ meeting is required under section 341 of the Bankruptcy Code.  In simple terms, it is a meeting of the minds between the parties present at the meeting.  The parties that will be present at the meeting will be you, the debtor; the debtor’s attorney, and a representative from the trustee’s office.  If you are in Chicago, Cook County, the trustee will be either Marilyn Marshall or Tom Vaughn.  If you are in Lake County or DuPage County or Will County, then  Glenn Stearns will be your trustee. The creditors’ meeting is nothing to be scared about.  As long as you are upfront and honest with your attorney when you originally met with him, the creditors meeting should be no + Read More

Is there anything I should NOT do if I’m thinking of filing for bankruptcy?

There are several things that you should not do if you are considering filing for bankruptcy under either Chapter 7 or Chapter 13.  One of the things that people do which is a prohibited act is repaying a family member or a friend within a year of filing for bankruptcy.  This is known as a preferential payment and the court can undo that type of payment or repayment. The other thing people do is they borrow from their 401(k) in an effort to repay their creditors only to find that they did not have enough money in their 401(k) to repay all of their creditors and now they have exhausted all of their retirement.  The retirement accounts would have been protected in either a Chapter 13 or a + Read More

What do I need to do before filing for Chapter13 Bankruptcy?

The very first thing you need to do before filing for Chapter13 is to meet with an experienced attorney in your area to talk about your case. Most attorneys will have a bankruptcy questionnaire which you will fill out in advance or at your meeting. The questionnaire is a detailed listing of all of your assets, all of your liabilities and your statement of financial affairs. By filling out this questionnaire, the attorney will start to understand what your situation is. You may be trying to save a home that’s in foreclosure. You might be trying to repay non-dischargeable debt over time. You might have disposable income and you just want to protect all of your property and repay either all or + Read More

Who can file a Chapter13 bankruptcy?

A Chapter13 bankruptcy can be filed by an individual or a joint case husband and wife.  Chapter13 cannot be filed by a corporation.  In order to file for Chapter 13, an individual must complete several prefiling requirements.  The most important requirement is the taking of a credit counseling session.  The credit counseling session is a one hour session on the computer or over the telephone whereby you talk with a credit counselor in order to receive a certificate enabling you to file for bankruptcy. In addition to the credit counseling requirement, you will have a personal financial management instruction course which must be completed after your cases filed but before it goes to a + Read More

What are the most common causes of Chapter 13 bankruptcy?

Chapter 13 bankruptcy is reorganization through a Chapter 13 trustee.  The reason why many people will file Chapter 13 is to save a home that has gone into foreclosure.  Now, the reason why the home fell into foreclosure could be several; in many cases, someone has lost their job, fallen behind on their bills and now they are back employed.  In other cases, someone has had an illness which caused them to lose work and now they have recovered from illness and are back gainfully employed.  There are other situations such as divorce or straight job loss that can lead someone to fall behind on their bills and be in need of a Chapter 13. The most common form of Chapter 13 or reason for a + Read More

Do I have to hire an attorney to file for bankruptcy?

You do not have to hire an attorney to file for bankruptcy; however, I would strongly recommend that you do so.  You do have the ability to fill out forms online or from an office supply company, go down to the clerk’s office and attempt to handle a Chapter 7 or Chapter 13 bankruptcy case on your own. The problem with doing so is that the law has gotten very complex, especially since the law changed October 17, 2005.  It used to be that someone with a simple Chapter 7 case could technically do the case themselves with very little in the way of error except for possibly losing property.  Under the current law, there are all kinds of pre-filing requirements that must be satisfied before a + Read More

What is Chapter 13 bankruptcy?

Chapter 13 bankruptcy is one form of bankruptcy under the United States Bankruptcy Code whereby someone reorganizes their debt and pays back either all or a portion of the debt over a 3 to 5 year period.  Chapter 13 is most commonly used to save a home that’s in foreclosure.  In a Chapter 13, a debtor is able to make the regular mortgage payment on time once again and pay the part that they fell behind over the next 3 to 5 years.  The amount that they pay per month is dependent upon their income, their expenses, their assets and their liabilities. In a typical Chapter 13 bankruptcy case, there is a Meeting of Creditors, a confirmation hearing and then an amount that is solid in terms of + Read More

Can my student loans be discharged in bankruptcy?

Typically student loans are going to be non-dischargeable.  A non-dischargeable debt is a debt that is not going to be eliminated in a bankruptcy case.  Student loans are the type of debt that are typically non-dischargeable except for extreme hardship cases.  In my 21 years of practice, I have never had an extreme hardship case that was winnable before the court.  I did have a case where someone was schizophrenic and did not have the ability to work.  However, we could not prove that the schizophrenia occurred after the bankruptcy case was filed.  The threshold is very difficult and the burden is very difficult as well. The federal government and the private student loan carriers are + Read More

Bankruptcy – Difference between Chapter 7 & Chapter 13

Chapter 7 is a liquidation fresh start type of bankruptcy whereby a person who has very little in the way of assets and a lot of unsecured debt can file a Chapter 7 and get a fresh start.  Under Chapter 7, debtors typically keep all of their properties such as houses, cars, personal belongings provided they continue to make monthly payments on those secured items.  Chapter 7 is the most common for someone who is not making a lot of money or doesn’t have the ability to repay their debt and has not received a Chapter 7 bankruptcy discharge within the last eight years.  Chapter 7’s make up 75% of all bankruptcy cases that are filed throughout the country whereby Chapter 13 represents + Read More

What is a 341 Meeting?

A 341 Meeting is a meeting of creditors we acquired and mandated by the Bankruptcy Code whereby a debtor will be examined under oath by a Chapter 7 trustee regarding assets and liabilities.  The Chapter 7 trustee has the duty to examine the debtor and determine whether or not there are any assets that can be taken and sold by the trustee for the benefit of the creditors.  The trustee will examine the debtor under oath and it will be recorded.  The meeting should last anywhere from 2 to 7 minutes and the debtor should not be shocked by any of the questions at the 341 Meeting.  The trustee is going to want to ask if the debtor listed all of their assets, all of their liabilities and did they + Read More

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