The 341 Meeting

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Highway sign reading, 'Truth or Consequences'

The Truth, The Whole Truth, and Nothing But the Truth

The old adage, "honesty is the best policy" really applies to bankruptcy. This is especially true during what's known as the 341 meeting of creditors, a required court appearance during which you must present all financial documents relevant to your bankruptcy claim, such as tax returns, paystubs, etc. At the 341 meeting, these documents must be given to the bankruptcy trustee who will then verify the accuracy of the documents. The debtor is expected to answer all questions during this proceeding while under oath.

If it is later determined that you hid any assets or information, you could have your bankruptcy dismissed, or worse. For example, if a homeowner sold his/her house within one year of filing for bankruptcy, he/she is expected to disclose that sale, as well as any profit from it, on the bankruptcy petition. At this stage, mistakes and omissions can be easily corrected. At a 341 meeting, on the other hand, such misinformation can be catastrophic.

Let's say, for example, that a debtor named Fred made $20,000 from the sale of his house. At the 341 meeting, Fred mentions that he sold the house, but he claims he made no money from the sale. The bankruptcy trustee will then investigate Fred's claim to make sure it's accurate.

Now, let's say the trustee finds out the truth — that Fred did, in fact, make $20,000 from the sale of his home. The trustee will then require an explanation of what happened to that $20,000. If Fred has an explanation, but no receipts or other documents to prove his explanation is true, the trustee will automatically move to deny Fred the bankruptcy, citing that he concealed property with the intent to defraud the court.

Remember, at the 341 meeting, you are under oath. If the court grants the trustee's motion to deny the bankruptcy, Fred will never be able to discharge his debts, and he will never be able to file for bankruptcy in the future, either. When it comes to filing for bankruptcy, make sure you are doing your very best to be accurate at all times. There is no fooling the bankruptcy trustee, and the repercussions of fraud are dire.

Call Today for a New Start

If you're ready to take back control of your finances, call 301-589-4597 or email me at ds@dsteinlaw.com to discuss your options. I offer free consultations to those enduring severe financial strain in Maryland and Washington D.C., including areas around Baltimore, Bethesda, Silver Spring, Gaithersburg, Rockville, Wheaton, Upper Marlboro, Bowie, College Park, Laurel, Frederick, Hagerstown, Hyattsville, Salisbury, Towson and Glen Burnie. Let me help you make a new start today.