One of the most nerve-wracking parts of filing Chapter 7 bankruptcy is the 341 hearing (even though this is actually an administrative hearing and nothing like a scene from Law & Order!). Once your hearing has been concluded, what’s next? Our firm makes it a point to not only provide our clients with a “to do” sheet at the beginning of their case but we also send email reminders and text messages to ensure that nothing gets missed. Once your hearing is over though there are some deadlines to be aware of:
THE UNITED STATES TRUSTEE REVIEW:
The United States Trustee trustee has ten days to file a “statement of presumed abuse” if they disagree with your budget and feel that you could actually repay some of your creditors in a Chapter 13 case. Most of the time this notice is NOT filed but sometimes with higher income clients, they can see this notice filed and then just have to provided some additional documents regarding their income and expenses.
THE CHAPTER 7 TRUSTEE
Your Chapter 7 trustee has 30 days to object to your bankruptcy exemptions. If the trustee thinks you have too much money in the bank, too much in paid for cars, too much real estate equity, or too much value in any other asset they can file this objection. We rarely ever see this objection filed in our cases.
Your creditors have 60 days from the hearing to object. Creditors will usually object due to recent use of the credit or they are accusing you of incurring the debt through fraud.
Credit card companies will object if they think you were running up your credit cards while you were getting ready to file bankruptcy. Typically if these charges were for basic living items (food or gas) and you didn’t intentionally run them up, the credit card companies will back down. However, if you decided to use your credit card to purchase cruise tickets 1 week before filing, you will be setting up a repayment plan with the creditor on that one.
The other way we hear from creditors, is a claim that your whole debt is fraudulent. Many times this is a very personal debt (Ex-spouse or family member, former friend, or former business partner). These personal grudge creditors can claim several things to try to prevent you from discharging your debt. In order to do this, they have to file what is known as an “Advesary Proceeding” in your case (which is a lawsuit within your bankruptcy case to deal with that specific debt). These are actually VERY rare but we always see a few a year. Defending one of these actions will cost you additional attorneys fees so always make your attorney aware of any landmines when you meet. That way your attorney can set your expectations and have a plan ready in the event one is filed.
For most cases, after the 341 hearing, you just need to make sure the following have been taken care of:
1. If you are retaining any secured items (e.g car, home, furniture) you need to make sure that a reaffirmation agreement has been filed with the court. At this point, you should have already received the reaffirmation from the attorney office, signed it, and sent it back to the creditor to file. If you have NOT then you need to contact your attorney to follow-up on this.
2. If you had any judgment liens when you filed your case then you need to confirm that a Motion to Avoid Lien has been filed regarding that debt and that an order avoiding (removing) that debt has been entered on the court docket. If your case closes out and these liens are NOT avoided, then you will owe this debt after you are out of your case.
3. In order to receive your official discharge, you need to complete a second credit counseling course AND make sure that your attorney has filed this certificate with the court. Failure to do this will result in your case being closed without a discharge and you will have to incur additional fees to correct this and receive a discharge.
4. Review your petition one last time to ensure that ALL of your debts are listed. If you did forget someone there is still time to file an amendment to add them to your case.