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Explain The New Jersey Chapter 7 Bankruptcy Case Hearing

Attorney Explains The New Jersey Chapter 7 Bankruptcy Case Hearing.

There is one required hearing for a chapter 7 bankruptcy case that is filed in New Jersey. The hearing is called the “Meeting of Creditors” or a “341(a)” hearing, which is the bankruptcy code section that requires the hearing.  The entire State of New Jersey has three bankruptcy court locations, Camden, Trenton and Newark. The court in which a person’s bankruptcy case is filed, typically depends on the location of their residence. Debtors who file their case in the Camden and Newark locations, attend their “341(a)” hearings in an office building. Debtors who file their cases in Trenton, attend their hearing in the Trenton bankruptcy court, but not in a courtroom.

The court randomly assigns each case to a trustee. A trustee is the person who is responsible for administering each chapter 7 case. The trustee reviews the bankruptcy petition and the various documents that are require to be submitted, such as: pay stubs; bank statements; income tax returns; real estate valuations; mortgage statements, etc. The trustee has the responsibility of researching the debtor’s financial circumstances to determine if the debtor meets the chapter 7 discharge criteria. The trustee provides her recommendation to the presiding judge as to whether the debtor is entitled to a discharge.Typically, if the trustee recommends a discharge, the judge will sign the order of discharge.

Additionally, the trustee is responsible to ensure that the debtor either has no “unexempt” assets to sell. Or, in the alternative, the trustee is required to sell and administer the sale of any assets. Please note that it is very unusual for a debtor to file a case, where an asset is sold. Also, prior to the New Jersey bankruptcy filing, the debtor should know whether the trustee has the right to sell an asset, based on the bankruptcy laws and each person’s financial and asset position.

The Meeting of Creditors Hearing is scheduled about thirty days after the bankruptcy filing. Most likely the only people in attendance, at the hearing, is the debtor and his attorney. It is very unlikely that a creditor appears at the hearing. From my experience, the only creditors that typically appear are individual creditors who had a relationship with the debtor, such as an ex-spouse or individual who made a loan to the debtor. Typically, the trustee and his staff review the debtor’s bankruptcy petition and documents in preparation for the hearing. The hearing is very short and lasts about seven minutes. The hearing is recorded and the trustee “swears in” the debtors prior to questioning.

The trustee will confirm that the debtor read and understood the completed petition prior to signing. The trustee will ask various questions for different reasons. However, In general, the trustee’s main objective is to elicit questions that, (1) determine if the debtor owns valuable assets; (2) determine whether the debtor could sue for valuable assets (money); (3) confirm that the debtor’s household income is less than their reasonable and necessary monthly household expenses, that are required to live. Also, the trustee will ask questions to determine whether the debtor’s financial difficulties and bankruptcy filing was unintentional

Contact Manchel New Jersey Bankruptcy Law at 866 503 5644 to discuss your NJ. bankruptcy law questions.

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