What Happens At My Chapter 7 Bankruptcy “Hearing”?

November 12, 2019 | By Steffens Law Office
What Happens At My Chapter 7 Bankruptcy “Hearing”?

Every person who files a Chapter 7 bankruptcy must attend a "hearing" within 21-45 days. Although the hearing requires you to testify under oath, while being recorded, it is more of a meeting than a hearing. Usually, the only people participating at this "meeting of creditors" (the legal name for the hearing) will be you (the debtor who filed bankruptcy), your attorney, and the trustee that has been assigned to your case.

  • What is the Purpose of the Bankruptcy Hearing?

The general purpose of the bankruptcy hearing is to have the debtor testify, under oath, about the accuracy of the bankruptcy petition and schedules (formal court paperwork) that were filed in the case.

  • Will a Judge Ask me Questions?

No, there will be no judge at your hearing – only a "bankruptcy trustee". The trustee is a lawyer representing the Court. It is his/her job to determine whether you have any assets (such as money in a bank account, tax refunds, an inheritance, expensive cars, etc.) that may be claimed for a distribution to creditors. The bankruptcy trustee also wants to make sure you did not try to hide assets or give property away to someone, just before filing bankruptcy.

  • Will Creditors Attend my Hearing?

Creditors rarely show up. Credit card and medical debt collectors basically never appear. In 1% to 3% of the hearings, a bank representative who loaned you money (e.g., for a business or a car), a former business partner, or an ex-spouse may attend the hearing. But, most of the time, the only people there are other debtors, other debtor attorneys, and the trustee.

  • How Long will my Bankruptcy Hearing Take?

In most cases, the debtor answers questions for about 5 minutes. Usually, the trustee will conduct 6 to 8 hearings every half hour.

  • Will I Lose my Right to File Bankruptcy at the Hearing?

No, unless you blatantly lie at the hearing. Whether or not you can or should file bankruptcy is not an issue at your hearing. However, you must tell the truth and your paperwork needs to be accurate. People who lie under oath, or attempt to hide assets, are subject to criminal prosecution. If convicted, you could be sentenced to jail.

  • What is the Step-by-Step Procedure at the Hearing?

1st   Meet your attorney outside the hearing room 10 to 15 minutes before the hearing time. Expect to see other debtors also waiting for their hearing.
2nd   Proceed into the conference room or courtroom, and sit quietly until your name is called.
3rd   When it is your turn, approach the trustee, with your driver's license or identification card, proof of social security number (e.g., social security card, W-2, insurance card, or tax return), and bank statements showing the amount of money on deposit in your bank account(s) on the day your bankruptcy was filed. Have these items out and in your hands, when you approach the trustee.
4th   Hand the ID cards and bank statements to the trustee and remain standing in front of the trustee while he/she swears you in.
5th   The trustee will ask you to be seated and then begin asking you questions.
6th   After the trustee is finished, if there are creditors waiting, they will be allowed to ask a limited number of questions. We will be present to make sure that you are not badgered or harassed. In some cases, we may ask you a couple of questions to clarify your prior testimony.
7th   After the hearing, we ask you to wait outside for a brief review. The vast majority of our clients (probably 98%) are pleasantly surprised at how painless and quick their hearing was.
8th   We will remind you to take your second bankruptcy "pre-discharge" debtor education course, now that you've completed your hearing.

  • What Else do I Need to Know?

1.   Be respectful and courteous to the trustee. The fate of your case is in his/her hands.
2.   Be a good witness by paying attention and listening closely to questions. Keep your answers short – typically "yes" or "no". Always tell the truth.
3.   Be ready when your name is called to testify.
4.   Be calm and confident. Having read this report, there is no one there better prepared than you. And, you are represented by an attorney who has appeared in more than 100 hearings.

If you have other questions about your bankruptcy hearing, please call the Steffens Law Office. We have over 50 years combined experience in debtor/creditor work, and we personally look forward to helping you through the hearing process.