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Chapter 7 Bankruptcy and 341 Meetings 

Filing for Chapter 7 bankruptcy can be time-consuming and stressful. You must meet the eligibility requirements, complete various forms, and follow specific steps. Any error you make could result in a delayed process or denied petition.

You should hire an experienced bankruptcy attorney to guide you through the complex procedure, whether you owe money to lenders, credit card companies, healthcare providers, or other creditors. 

Eligibility Requirements for Chapter 7 Bankruptcy

Chapter 7 bankruptcy is one of the most commonly filed types of bankruptcy. Individuals can choose to file this kind of bankruptcy to discharge debts.

You must pass the means test to proceed with the filing. The means test evaluates a person’s finances to determine whether they meet the necessary criteria.

Your family’s gross income is compared to the median income in Iowa for a family of your size. You can find your family’s gross income by adding your gross income from the last six months and multiplying it by two.

You could face a denied petition for Chapter 7 bankruptcy even if you pass the means test and meet other requirements. The most common reasons for a denied petition include:

  • You can pay back some of your outstanding debt with disposable income
  • You already filed for Chapter 7 bankruptcy within the last eight years or Chapter 13 bankruptcy within the last six years
  • You failed to meet the credit counseling requirement

You might have other options if you don’t qualify for Chapter 7. Filing for Chapter 13 or 11 could be beneficial if you meet the eligibility requirements.

Discharging Debts with Chapter 7 Bankruptcy

Filing for Chapter 7 bankruptcy allows you to discharge your debt. That means creditors can’t contact you or pursue legal action to recover the money you owe.

The different types of debts you can discharge include:

  • Medical bills
  • Deficiency balances from selling a repossessed vehicle or foreclosed mortgage
  • Credit cards
  • Trade or vendor debt
  • Certain tax obligations
  • Personal liability from guaranteeing someone else’s debt
  • Unsecured personal loans
  • Store accounts

Debts you can’t discharge by filing for Chapter 7 include:

  • Student loans
  • Domestic/marital obligations
  • Some tax obligations
  • Debts incurred from misusing or misappropriating funds while under a fiduciary duty
  • Criminal restitution
  • Debt from engaging in fraudulent activity
  • Debts incurred by willful or malicious injury

Elements of a 341 Meeting

After meeting eligibility requirements and filing your Chapter 7 bankruptcy petition with the necessary documents, you must attend a hearing called a 341 meeting of creditors.

The bankruptcy court will send you a notice with the location, date, and time of the hearing. It will also notify your creditors of the scheduled hearing, so they have the option of attending.

The court will appoint a trustee to oversee your case. The trustee will attend the hearing and ask questions regarding your bankruptcy filing that you must answer under oath.

The creditors in attendance can also choose to ask you questions about the information in your bankruptcy forms and financial affairs. However, many decide against taking this opportunity.

The purpose of a 341 meeting is to confirm the information you provided on all required forms is complete and accurate. You also must prove your identity by producing two forms of identification, such as a Social Security card and a driver’s license. 

If the trustee determines you qualify to have your debt discharged, you will receive a discharge or order. This will erase your qualifying debt, so you never have to pay it back to the creditors.

Contact Us

At Telpner Peterson Law Firm, LLP, we represent clients in bankruptcy cases to help wipe the slate clean for a better financial future. We understand how overwhelming it can be when you face debt you can’t afford to pay.

Our Council Bluffs bankruptcy lawyers have over 100 years of combined legal experience. When you hire us, we will explore all available options and assist you with your bankruptcy filing.

If you face debt and want to learn whether you’re eligible for Chapter 7 bankruptcy, call us at 712-325-9000 today for your confidential consultation.

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