What to Expect in Bankruptcy Court: The Meeting of Creditors

Photo courtesy of Richard Rutter

Also known as a 341 hearing (named after section 341 of the Bankruptcy Code), this meeting will include the trustee who is handling your case, any creditors to whom you are indebted, your attorney, and you.

It can be quite stressful and anxiety inducing waiting for your 341 hearing. Appearing in court is never something you should take lightly, but the Meeting of Creditors is actually a lot less intimidating than it sounds. Instead of appearing before a judge, this hearing will be handled by the trustee. Although creditors are welcome to attend this meeting, very few actually make an appearance.

When you and your attorney file for a Chapter 7 or Chapter 13 Bankruptcy in the State of New Jersey, a trustee will be assigned to your case. The duties of a bankruptcy trustee are to review the case in order to determine whether or not you have appropriately met all of the required criteria. Consequently, the trustee will ultimately be the one to decide if you are qualified for a discharge of your debts.

Once your case has been filed with the court and assigned a trustee, your 341 hearing (Meeting of Creditors) will usually take place about a month later.

The meeting will take place in the courthouse where your bankruptcy petition has been filed. As a general rule, debtors are assigned to the County Court in which they reside. There are exceptions, however, and the court may assign your particular case to a different New Jersey vicinage if he or she feels it would be more appropriately heard elsewhere.

During the Meeting of Creditors, it is usually in your best interest to speak as little as possible. The trustee assigned to your case will question you. We advise our clients to answer with yes or no answers when at all suitable. Doing so avoids giving the trustee any reason to ask additional questions.

Be honest in your answers, but be concise and as accurate as possible without volunteering any additional outside information that the trustee may use as a launchpad to begin a completely new and different line of questioning.

We always remind our clients that the 341 hearing is not an interrogation. It is solely for fact finding purposes regarding the contents of the bankruptcy schedules, which are the important documents that make up the bulk of your bankruptcy petition. The trustee needs to verify that all of the information on your paperwork is valid. Typically, these meetings are short and routine.

For more information about filing for bankruptcy in New Jersey, contact us at Veitengruber Law today.

How Can I Afford an Attorney? I’m Broke!

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“Slow and steady wins the race.” – Aesop

If you are struggling financially and are considering filing for bankruptcy, you are probably wondering how you can afford to hire a reputable attorney to help you. After all, you already have no money to spare, right?

A common misconception in today’s society is that all attorneys charge exorbitant hourly rates and require eye-popping retainers before they will even consider working with you, even on a bankruptcy or credit counseling matter.

Also, we’re aware that filing for bankruptcy is probably not something you had ever planned on, and that you may feel embarrassed about it, which may prevent you from getting the help you need. Don’t let your pride get in the way, though, because you have a lot more options than you may realize.

It’s important to remember that once your bankruptcy case is filed with the court, you will likely be able to stop making many or all of your monthly payments that you’re currently struggling with, like your mortgage payment, utility bills, credit card payments and more. Eliminating the payments that you are currently drowning in will consequently free up a good percentage of your income.

This will allow you to easily pay your bankruptcy attorney and then some. You will be able to erase a huge chunk of debt from your life and, in some ways, you will be given an amazing chance at a “do over.” This is a way to get your financial life back into a semblance of order, and it is possible. After all, if other people can do it successfully, why not you?

When filing for a Chapter 13 Bankruptcy, only a portion of your attorney fees must be paid before filing. The remainder of your attorney fees will be set into the Chapter 13 payment plan, giving you a period of 3 to 5 years to repay your attorney.

Additionally, Veitengruber Law offers payment plans that are flexible and tailored to meet our clients’ needs, regardless of which type of bankruptcy best fits your life. We happily allow clients to pay what they can afford on a monthly basis. We let you spread out your payments accordingly, as long as you make payments regularly. We are here to walk you step-by-step through your bankruptcy and we understand that you won’t be able to pay all of our legal fees up front.

After all, the reason we entered this field was to help people like you! For a different kind of legal experience, call our office today or visit us on the web. We’re here to show you the way to financial security.

Can a Bankruptcy Petition be Amended?

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You’ve gone through all of the paperwork necessary to file for Chapter 13 or Chapter 7 bankruptcy. You’ve worked long and hard with your attorney to make sure all of the necessary documentation is in place and has been filed with the appropriate legal institutions on time. As you may have realized by this point, filing for bankruptcy can be a very time consuming undertaking. Luckily, when working with an experienced bankruptcy attorney, they will work in tandem with you to process your bankruptcy paperwork in a fraction of the time had you been doing it on your own.

That being said, suppose you suddenly realize that you had forgotten to alert your attorney about a creditor who should have been included in your bankruptcy paperwork. From time to time, this happens. Your first instinct is probably to panic, thinking that you will possibly be unable to discharge any debts that you had forgotten to list on your original petition.

We are here to tell you that this has happened before, and there is a solution. Even when working closely with your attorney, it is possible to leave a debtor out by accident. As long as the omission was simply an honest mistake, bring the error to your attorney’s attention as soon as you notice it. At Veitengruber Law, we will attend to the matter immediately, making changes to your bankruptcy petition if needed.

Whether or not your petition will need to be amended depends on which type of bankruptcy you filed for, and how far along your case is in the proceedings. In a Chapter 7 filing, a debt to an omitted creditor will automatically be discharged along with all other debts because as a general rule, in Chapter 7 no asset cases, no debts can be collected from a debtor who has had their debts discharged. If your Chapter 7 bankruptcy is an asset case, we can help you ascertain the specific information about what steps need to be taken next in order to get you the best result possible.

It is a good idea to alert any omitted creditor(s) to the fact that you are filing for bankruptcy, and your attorney at Veitengruber Law will take care of telling the creditor not to attempt to collect any debt from you, should your case be a no asset case.

If your bankruptcy was filed under chapter 11, 12, or 13, any of omitted debts will unfortunately not be bound by the bankruptcy proceedings. Any debt owed to an omitted creditor in any of these proceedings will not be discharged and will survive the bankruptcy filing. In this case, contact your bankruptcy attorney and ask about reopening your bankruptcy case in order to include the debtor who was accidentally forgotten. For immediate help with all of your bankruptcy questions and needs, call Veitengruber Law, or connect with us on our website, or on Facebook and Twitter. We’re happy to correspond with you in the manner that you find most comfortable.

Are You a Target for Consumer Fraud?

Many people are under the false assumption that consumer fraud simply cannot happen to them. Unfortunately, the statistics on consumer fraud speak for themselves, and many extremely intelligent people, including savvy business owners and successful professionals, have indeed been victims of consumer fraud.

There are many situations that present a potential to be defrauded, including but not limited to interactions via: telephone, snail mail, and on the Internet. In fact, it is even possible to be defrauded in person; completing a face-to-face deal with someone does not eradicate the importance of being alert for potential scam artists. Some of them are so good at what they do that they can convince almost anyone to give them their hard-earned money.

A mind blowing $343 million have been lost in the past 12 months due to consumer fraud. The actual number may be even higher, due to some instances of fraud going unreported.

Many people are unaware of the potential for being defrauded in simple everyday situations, such as signing up for a magazine subscription or making an average purchase online. The definition of consumer fraud ranges from being duped to pay a higher than necessary rate on a variety of items and services, to the more severe end of the spectrum, which involves identity theft.

In general, we (as a society) are much more aware of the constant potential of being scammed, and technological advances have prevented some cases of Internet fraud, but not all. In order to be avoid being a victim of consumer fraud, there are certain things you can do.

For instance, avoid giving your credit card number, social security number or any other important financial information over the phone, through the mail or on the Internet unless you have initiated the contact and are certain of the person or institution with whom you are dealing.

Be on the lookout for sure signs of consumer fraud such as: using high-pressure wording like, “Act now or miss this opportunity!” Be very wary of any business demanding payment upfront, especially if you have been told you’ve won something, but you must make a payment to claim your prize. The chances of prize claiming scenarios turning out to be consumer fraud are nearly 100%.

And finally, if something sounds too good to be true (that you will make millions of dollars or a huge amount of profit with zero risks involved), you should walk away from that potential dealing immediately. Nobody gets rich quick – it’s that simple.

With all of this being said, if you have already been a victim of consumer fraud, or fear that you might have been, Veitengruber Law specializes in writing these types of wrongs by seeking out the scam artist and meeting him in court. You’ll need high quality help fighting consumer fraud, and you’ll want someone who has experience dealing with hustlers. We will help you get the results that you deserve. Like us on Facebook and your consultation will be free of charge!

Photo courtesy of Andres Rueda

The Importance of Proper Estate Planning

Every day, people put off setting up their Estate Plan (otherwise known as Last Will and Testament, or simply a “will”) because, quite honestly, dying is an unpleasant thing to ponder.

However, ensuring that your close family members and loved ones will be able to successfully move on after your death will involve some participation on your part. By establishing a clear and reasonable Estate Plan, you can help your loved ones avoid petty arguments or an all out family war.

First, let’s talk about the legal side of things. If you pass away and do not have any sort of Will and Testament set up, the state you reside in will ultimately have most of the power to determine how your property will be divided. Normally, the court system will transfer most or all of your real property to your spouse or descendants, but if you don’t have any living family members, they have the freedom to give your money to your state of residence. Do you really want that to happen?

The state court can also decide to distribute your property among the following people: your parents, all or some of your living siblings, your living grandparents, children of your spouse from a previous relationship, your children’s children, or, again, to the state itself.

Passing away without a Will or Trust means that your Estate will be subject to the laws of intestate succession. Since you will have passed on, you will have no say in how your assets are divided. There are many good reasons for ensuring that this does not happen. Perhaps you have a significantly high net worth. Your surviving descendants could most likely benefit greatly from keeping that money in the family.

Your family members could also end up in a long, drawn out battle over property and entitlement – sometimes over seemingly insignificant items.

Take for example, Harold Black*. Mr. Black was a 67-year-old retiree who worked part-time at the local grocery store. By the time he contacted our office, he was overwhelmed and distraught. As he told it, Harold was lucky enough to meet a lady friend last year at the Senior Center. Harold and Lucy became fast friends and after a few months, they even got engaged. They picked out the engagement ring together, and Harold paid for it.

Several months later, Lucy passed away. It was a known fact that Lucy had cancer, but Harold had wanted to marry her regardless. Unfortunately, she became too ill and weak to go through with the wedding before her death. Some time later, Harold found himself in dire financial straits, having lost his part time job due to cut backs. He asked Lucy’s sister if she knew the whereabouts of the engagement ring. He hated to do it, but he asked for it back, explaining that it was the only thing that might pay his rent that month.

Unfortunately, Lucy’s family refused, claiming that the ring was a gift to Lucy and therefore didn’t warrant being returned to him. Although it pained him to do so, Harold hired an attorney to help him, and what ensued was a long and painful court case that could have been avoided had Lucy prepared a proper Will.

In the end, Harold did end up with the ring due to the fact that, although it was a gift, the court determined that it was a conditional gift. Since the condition of marriage wasn’t able to be fulfilled, Harold got to keep the ring, but only after a tortuous 5 months of vicious court testimony by Harold and Lucy’s sisters, leaving everyone in the situation bitter and resentful.

Another good example of the importance of having a solid Estate Plan involves a wealthy New York real estate developer worth over $40 million. He passed away and left all of his money to…no one. As his friend Paul Skurka said, “He was a very smart man, but he died like an idiot.”

Don’t follow in his footsteps. Set up your Estate Plan today by calling our office for a consultation. I promise you’ll be glad you did.

*All names and details changed to protect identities.

Photo courtesy of Carnie Lewis