What Happens at the Meeting of Creditors?

At the meeting of creditors, the debtor (that’s you) must make a personal appearance. Before the pandemic, these appearances were at the courthouse, but for the last two years, these “appearances” have been over the phone or zoom video conference. Your attorney will also be present on the call (or in the courthouse) with you. This is an opportunity for the trustee and creditors to ask questions about your financial situation. Though the judge is not present, this meeting is still an important part of the bankruptcy process. In most consumer cases, no creditors choose to attend so calling it a meeting of creditors can be scary, but really, it is most often just a meeting with the trustee. However, it is still a crucial step for your case.

The meeting is conducted by the bankruptcy trustee assigned to the case. The trustee is an attorney assigned by the court to review your case. Think of them as a sort of “auditor.” The debtor (remember, that’s you) must be present and answer questions under oath about their finances and the bankruptcy process. The trustee will ask the debtor to confirm their identity, review some documents, and ask questions about the debtor’s assets and liabilities. The trustee may also ask questions about any recent transfers of property or changes in income

Typical questions that are asked by the trustee at the meeting of creditors:

  • Did you read the bankruptcy petition before signing?
  • Did you list all of your assets?
  • Did you list all of your debts?
  • Do you want to make any corrections to the petition?
  • Have you lived in California for the past two years?
  • Do you owe anyone domestic support?
  • Are your cars insured?
  • Are you working now and what is the address of your employer?

What Happens After the Meeting?

After the meeting, the trustee will determine if there are any assets that can be liquidated to pay back creditors. If there are, the trustee will begin the process of selling those assets. In most cases, though, there are no non-exempt assets to sell. This means that creditors will not receive any payment from the debtor’s bankruptcy estate. However, the debtor will be relieved of their debt obligations and will be able to start fresh financially.

Thus, once the meeting with the trustee is concluded, the Trustee will usually file a Report of No Distribution that tells creditors that there is nothing available to distribute from your estate. Think of “your estate” as all your financial assets. Unless the meeting of creditors is continued, your case will be eligible for a discharge by the court approximately 60 days from the date of the meeting. It is very likely that the court will order a discharge and close your case after these 60 days, as long as the trustee filed a report of no distribution.

If you have any questions about the process please contact your attorney.