Bankruptcy Basics

There are several requirements involved in claiming bankruptcy.  I often refer to the requirements as the bankruptcy basics.  For example, you will have to make at least one court appearance.  This court appearance is called the creditors’ meeting or 341 meeting of creditors.  It’s Section 341 of the Bankruptcy Code, and it is a meeting between the trustee, the attorney, the debtor, and any creditors that decide to show up.  I would say 95 percent of the time, creditors do not show up in a simple Chapter 7 case, especially when there are no assets to be distributed.  If there are no assets to be distributed, creditors will not show up.  The court appearance usually comes roughly 30 days after you file your bankruptcy petition.  That is generally the only court appearance a debtor has to make. 


However, in certain circumstances, a debtor might have to appear in court for possibly a reaffirmation agreement.  They always have the option to go to court, especially in a Chapter 13 where the attorney has to make multiple court appearances.  If the debtor wishes to go to court, they can; however, most of the time, more often than not, the debtor does not have to appear in court unless the judge specifically asks for the debtor to come to court.  The attorney takes care of all of that.  Your attorney will explain in great detail all of your bankruptcy options.  So your court appearance as the debtor is very limited and the court appearance for the 341 creditors’ meeting is not a court appearance in the sense of going to an actual room with a judge and a court reporter.  It’s not that type of situation. 


The 341 meeting is generally very informal.  It’s with the trustee, once again, not necessarily in a courtroom.  It could be in an office or it could be in the courthouse.  People are afraid of going to that hearing, but it’s not really difficult at all.  The Trustee will ask a series of questions to determine whether or not there are assets to administer.  In the overwhelming majority of Illinois bankruptcy cases, there are no assets to administer and the debtor is granted a discharge.  If there are issues that arise at the meeting, your Chicago bankruptcy lawyer will explain to you your options and the likely outcomes.  Have confidence in your attorney.  Your attorney is trained to handle obstacles and clean up all the details of your case.  Most importantly, you should feel comfortable that your attorney is up to the task.