What is the “Meeting of Creditors”?

03 Aug What is the “Meeting of Creditors”?

The phrase “Meeting of Creditors” strikes fear into most of my clients’ hearts. They hear these words and get a mental image of sitting in a large, darkened room with a spotlight in their face and their creditors in hooded robes surrounding them.

The reality? In virtually all cases, there’s nothing to worry about. In fact, except in three types of cases, it is overwhelmingly likely that no creditors will show up. That’s right–not a single creditor attends the Meeting of Creditors in most cases.

What are the three exceptions?

1. Where you lied, or provided false, misleading or incorrect information on your petition or schedules. The Chapter 7 Trustee and U.S. Trustee see thousands of bankruptcy cases each year. Cases that don’t fit together properly stand out like a sore thumb, and it’s likely that you will be questioned closely about your statements.

2. Where you run your own business. In these cases, debt often is higher, and your creditors may be more comfortable in dealing with the bankruptcy system. Even here, however, the primary emphasis is the correctness and completeness of the schedules.

3. Where you are involved in a divorce. Here, your soon-to-be-ex-spouse may want to point out errors in your schedules or simply try to embarrass you.

Note that even if a creditor shows up, it’s unlikely that they will ask hard questions. “Why haven’t you paid” or “When will you pay” are not proper questions.

So what *does* happen? The trustee swears you in, verifies your identity (driver’s license and social security card), and then typically confirms (under oath) that all of the information in the schedules is true and correct, that you listed all of your assets and all of your debts. You may be asked why you filed the case, with the answer being just a few general words: job loss, illness, divorce. Depending on the details of your case, you may be asked additional questions about real property, a business, your job, etc.

Some Meetings of Creditors last for (literally) 30 seconds. Others can run longer. The typical meeting here in Maryland is about 3-5 minutes in a Chapter 7, and 5-7 minutes in a typical Chapter 13.

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Brett Weiss, a senior partner at The Weiss Law Group, LLC, represents people and businesses in all phases of bankruptcy. He has experience in complex individual Chapter 7, Chapter 11, and Chapter 13 bankruptcy cases, and in Chapter 11 small business restructuring and reorganization. Mr. Weiss lectures nationally on bankruptcy issues. He has testified before the Federal Bankruptcy Rules Committee, the Consumer Financial Protection Bureau, and has twice testified before Congress on bankruptcy and credit issues. Brett Weiss is the co-author of Chapter 11 for Individual Debtors, and has written Not Dead Yet: Bankruptcy After BAPCPA, for the Maryland Bar Journal, as well as hundreds of blogs for the Bankruptcy Law Network. With his colleague, Daniel Press, he recorded a 13-hour basic bankruptcy training series, and leads intensive three-day Chapter 11 training boot camps. Mr. Weiss has received international media attention in connection with his work. He was interviewed by Barbara Walters on The View, has appeared on the Today Show, Good Morning America, ABC News with Peter Jennings, the Montel Williams Show, National Public Radio, AARP-TV, the BBC World Service, German state television, and numerous local radio and television programs, and been quoted in Money magazine, The Washington Post and The Baltimore Sun, among others. Brett Weiss is the previous Maryland State Chair for the National Association of Consumer Bankruptcy Attorneys, a founding member of the Bankruptcy Law Network, on the board of the Maryland State Bar Consumer Bankruptcy Council, and a member of the American Bankruptcy Institute and the Bankruptcy Bar Association of Maryland. He has received the Distinguished Service Award from the National Association of Consumer Bankruptcy Attorneys for his work on behalf of consumers across the country. Mr. Weiss is admitted to practice before Maryland and District of Columbia federal and state courts, the United States Courts of Appeals for the DC, Fourth and Eighth Circuits, the United States Tax Court, and the Supreme Court of the United States, and has been practicing law since 1983.

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