It gets difficult to come up for new and interesting ideas about Indianapolis bankruptcy. Sometimes, the best inspiration comes from real life. This morning I was in the Southern District of Indiana Federal Court building for a 341 hearing with one of my clients when I got the inspiration for this blog.
The 341 meeting of creditors is a hearing that every person who files Chapter 7 or Chapter 13 bankruptcy must attend. The hearings take place in the federal court building in downtown Indianapolis in 3 different hearing rooms. There are 5 or 6 hearings set for every half hour. The trustee calls up one case at a time and the other debtors and their attorneys wait for their case to be called. Often, when a debtor is in front of the trustee, there are many people watching the trustee question them.
Today, I was sitting with a client waiting for our Chapter 7 bankruptcy hearing to be called and I observed one hearing in particular that I thought would make a good blog posting. Specifically, there was a couple who had filed bankruptcy. The day before the hearing their attorney had amended their Schedule I (income) because when the petition was filed it listed their pay as semi-monthly instead of bi-weekly. The result of this amendment was that the income showing when their petition was filed was much lower than their actual income. At the same time the attorney filed an amended Schedule J (expenses).
The trustee reviewed these changes and noticed that when the debtors filed their original petition they listed many of their expenses much lower and then increased their expenses after the petition was changed to reflect their actual income. For example, their heating expense increased from $100.00 per month to almost $400.00 per month. Their cell phone bill increased from $100.00 to almost $300.00 per month. These are expenses that typically do not fluctuate and let the trustee to ask the debtors why their expenses had increased….and whether their expenses had just increased because the income reported on their bankruptcy petition had increased. The debtors testified that the higher expenses were their actual expenses and that they didn’t know why the original petition showed the lower expenses.
Understandably, the trustee was at a loss. She then asked the debtors whether they had read the bankruptcy petition prior to filing it. They said that they had and she was even more at a loss. My personal guess, from my experience as a bankruptcy attorney, that the Chapter 7 trustee believed that the debtors hadn’t read their bankruptcy petition when it was filed.
Needless to say, filing bankruptcy can be a stressful decision and the last thing that most people want on top of it is the trustee taking an extra long time to question them due to confusion regarding their bankruptcy petition. It is very important for the people who file bankruptcy to carefully review their petitions to make sure that they are accurate when they are filed because the petitions are being filed under the penalties of perjury. In addition, the trustee is going to question you regarding the petition and debtor prefer that their hearing go smoothly and that they avoid the bumpy ride of the debtors I saw this morning.
It is important to work with your attorney to make sure that you have a complete and correct bankruptcy petition. I can say that personally I don’t want any of my clients to have a difficult 341 hearing and I strive to make sure that the petitions are correct, that I have prepared my client regarding what to expect at the 341 and have provided the trustee all of the information necessary so that the hearing goes a smoothly as possible.
**Halcomb Singler, LLP, is a debt relief agency. It helps people file for bankruptcy under the bankruptcy code. No attorney-client relationship with the firm of Halcomb Singler, LLP, is created through this blog. Also, please note that Erika Singler is an attorney licensed in Indiana and does not seek to practice law in any jurisdiction in which they are not properly authorized to do so. The information contained in this blog is general in nature and should not be relied upon for the circumstances of any individual(s) or businesses.