We have been getting many repetitive questions regarding creditors and the 341 (i.e. Do they come, what causes them to come, etc etc), thus, I thought I would provide a general answer.
Background
First, you need to understand the purpose of the 341 and the role of the BK Trustee. What many people fail to realize is the BK Trustee is an advocate for your creditors; the Trustee is appointed to act in the best interests of your creditors, as a group. And the best interests of the creditors is to get some money for the debt they are owed. The 341 meeting is essentially a deposition, the meeting provides an opportunity for the BK Trustee, and any creditor who wants to attend, to ask the debtor questions.
Trustee as Creditor
As mentioned above, the trustee is appointed to represent your creditors, but the trustee represents the debtors' creditors collectively. The trustee is not in a position to advocate for the rights of any individual creditor. The BK trustees main job is to determine if there are any assets in the BK estate that can be sold or otherwise used to satisfy your debts, or in the case of a chapter 13, to try to maximize the payment.
Creditors at the 341 Meeting
Since the trustee acts on behalf of creditors, collectively...if an individual creditor has a specific issue that needs to be addressed, then they have the right to attend the 341 meeting and ask you questions.
Do individual creditors actually attend the 341
The short answer is, almost never. And for the most part, there is very little reason for a creditor to attend the 341 meeting.
Why might a creditor attend?
The 3 most common reasons creditors attend 341 meetings are (1) contemplating an objection to discharge, (2) information discrepancy (3) a local creditor that does not know any better.
(1) A creditor, particularly an unsecured creditor, will probably attend the 341 meeting to assess an objection to discharge assuming there are questionable charges/cash advances on the account. For example, if you did a balance transfer from your AMEX to your Chase Visa within 6 months of filing BK, odds are, Chase will send someone to the 341 to assess your explanation. (keep in mind, that a creditor only has limited grounds to object to discharge, they do not object for the sake of objecting). But even if the creditor has a reason to object, it is still 50/50 as to whether they will show.
(2) A creditor may attend if they see a significant discrepancy in the information you provided on your petition and the information you have provided the creditor. (honestly, most creditors don't even check, but it can happen).
(3) Finally, purely local creditors tend to show because they simply don't know any better (they don't know that they don't need to attend
)
A fourth reason a creditor might attend is if you have already reached an agreement with the creditor for a reaffirmation...the creditor may show to have you sign paperwork since they know you are going to be at the 341, but that scenario is not part of the 341 meeting, it is a matter of convenience.
If a creditor does show, what can I do
All a creditor can do is ask you questions at the 341 meeting; and since you will be under oath, all you can do is answer honestly.
The 341, Chapter 7 vs Chapter 13
Keep in the back of your mind that creditors almost never attend the 341, a creditor is more likely to attend a 341 in a chapter 7 than in a chapter 13. There are even fewer grounds for a creditor to object in a chapter 13, so there is even less reason for a creditor to attend a 341 in a chapter 13. The only creditors that may even think about attending a chapter 13 341 are secured crediotrs.
To reiterate, creditors ALMOST NEVER attend the 341 meeting, so it is not something you should be losing sleep over.
Background
First, you need to understand the purpose of the 341 and the role of the BK Trustee. What many people fail to realize is the BK Trustee is an advocate for your creditors; the Trustee is appointed to act in the best interests of your creditors, as a group. And the best interests of the creditors is to get some money for the debt they are owed. The 341 meeting is essentially a deposition, the meeting provides an opportunity for the BK Trustee, and any creditor who wants to attend, to ask the debtor questions.
Trustee as Creditor
As mentioned above, the trustee is appointed to represent your creditors, but the trustee represents the debtors' creditors collectively. The trustee is not in a position to advocate for the rights of any individual creditor. The BK trustees main job is to determine if there are any assets in the BK estate that can be sold or otherwise used to satisfy your debts, or in the case of a chapter 13, to try to maximize the payment.
Creditors at the 341 Meeting
Since the trustee acts on behalf of creditors, collectively...if an individual creditor has a specific issue that needs to be addressed, then they have the right to attend the 341 meeting and ask you questions.
Do individual creditors actually attend the 341
The short answer is, almost never. And for the most part, there is very little reason for a creditor to attend the 341 meeting.
Why might a creditor attend?
The 3 most common reasons creditors attend 341 meetings are (1) contemplating an objection to discharge, (2) information discrepancy (3) a local creditor that does not know any better.
(1) A creditor, particularly an unsecured creditor, will probably attend the 341 meeting to assess an objection to discharge assuming there are questionable charges/cash advances on the account. For example, if you did a balance transfer from your AMEX to your Chase Visa within 6 months of filing BK, odds are, Chase will send someone to the 341 to assess your explanation. (keep in mind, that a creditor only has limited grounds to object to discharge, they do not object for the sake of objecting). But even if the creditor has a reason to object, it is still 50/50 as to whether they will show.
(2) A creditor may attend if they see a significant discrepancy in the information you provided on your petition and the information you have provided the creditor. (honestly, most creditors don't even check, but it can happen).
(3) Finally, purely local creditors tend to show because they simply don't know any better (they don't know that they don't need to attend
)A fourth reason a creditor might attend is if you have already reached an agreement with the creditor for a reaffirmation...the creditor may show to have you sign paperwork since they know you are going to be at the 341, but that scenario is not part of the 341 meeting, it is a matter of convenience.
If a creditor does show, what can I do
All a creditor can do is ask you questions at the 341 meeting; and since you will be under oath, all you can do is answer honestly.
The 341, Chapter 7 vs Chapter 13
Keep in the back of your mind that creditors almost never attend the 341, a creditor is more likely to attend a 341 in a chapter 7 than in a chapter 13. There are even fewer grounds for a creditor to object in a chapter 13, so there is even less reason for a creditor to attend a 341 in a chapter 13. The only creditors that may even think about attending a chapter 13 341 are secured crediotrs.
To reiterate, creditors ALMOST NEVER attend the 341 meeting, so it is not something you should be losing sleep over.
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