In my last Blog, I discussed who must attend the meeting of creditors, how long they last, and the general background of trustees, in the Southern District of California. In this part II, we discuss who attends these hearings and the questions asked.
So who all is present at these hearings other than the Trustee? Other debtors and their attorneys. Very rarely will a creditor show up, even though that’s the name of the hearing…..creditors hearing. This is because very little can be done by the creditor at the hearing. Generally, if a creditor has a problem with your case, it will not take place at the creditor’s meeting, but rather, in the actual Bankruptcy Court and after a separate lawsuit is filed.
Also, every now and then, an additional person from the US Trustee’s office may come in and ask a few questions to individuals with higher than usual income or debt loads.It’s a very busy place, with 30 to 60 people filtering in and out each hour.
Debtors come from all walks of life. Some are in wheelchairs, others do not speak English, some are teenagers, others in their 90s. No one is immune from Bankruptcy and by the same token, immune from these hearings.So what will they ask? There is an excellent blog on all the questions that are possible written by Jill Michaux.
But as far as San Diego is concerned, expect the following:
1) State your Name and Address for the Record
2) Did you list all your assets?
3) Did you list all you debts?
4) Did you list all your income?
5) Is there any reason to make any changes to your schedules?
6) Have you transferred any property or money to any family members in the last year?
7) Are there any creditors present?
8) Thank you, your meeting is concluded.
And so it goes. I’ve seen 1 trustee locally conclude 15 of my hearings in 20 minutes before! It was like cattle call. I could not even keep up with moving one file off the desk and the next on the desk!
The bottom line is that these Trustees are only doing their job. The Chapter 7 trustees get $60 per case they handle(it comes out of your $299 filing fee), or about $900 per hour calendar. They rotate doing these hearings every couple weeks, and so $900 x 6 hours x twice per month is $10,800.00 to run their entire office and staff. Not much.
That is why their biggest focus is on the unwary that have too many assets. If they sell an asset, they get 25% of the first $5000, 10% of the next $45,000, and 5% of the amounts past $50,000. Collect $100,000 on a case and they get $8250. So just one chapter 7 case with a $100,000 assets is like doing 137 hearings! Now you really know their motivation!
So whats the bottom line? Prepare for the hearing. Spend at least an hour going over your bankruptcy petition and schedules. Be intimately familiar with those, as well as your income for the past 6 months. Always tell the truth! Don’t hide anything. Be straight! The Trustees have presided over thousands and thousands of hearings. They can smell an honest debtor from one trying to play tricks.
As long as you tell the truth and followed your attorneys advice, it will be over quicker than you know it!
Written by Michael G. Doan