What questions will the trustee ask me at my 341 meeting of creditors in a Chapter 7 bankruptcy? (video)

These are the standard questions that a bankruptcy trustee will ask you at a 341 Meeting of Creditors. This doesn’t mean that these are the only questions you’ll face, but these are the most common. Unless you have some interesting asset like a family vacation home in a trust which your dad set up years ago, you should be fine.

Will a chapter 7 bankruptcy discharge my speeding tickets?


You can discharge them in a chapter 13 (usually), but it may not be worth the extra attorney’s fees and 3 years of waiting for that to happen.

In a chapter 7, it will not discharge a debt ” to the extent such debt is for a fine, penalty, or forfeiture payable to and for the benefit of a governmental unit ….” 11 U.S.C. 523(a)(7).

This means that your traffic fines/citations will survive a chapter 7 case. That being said, if you file chapter 7 and discharge all of your other debts, that should hopefully free up enough of your monthly income to pay off the speeding tickets rather quickly.

A good rule of thumb is that priority debts like most taxes, student loans, criminal restitution, and child support/alimony survive your chapter 7 case. Everything else disappears. It goes without saying that if you’re unsure if a debt will be discharged, that you should ask a bankruptcy attorney.

As for the speeding tickets, the best way to prevent them is to (in the words of my law enforcement friends) “stop breaking the law, jackass.” Unfortunately, I seem to have a lead foot.

Can the bankruptcy trustee take my kids’ Christmas presents?

Yes, yes he can.

That being said, I’m an attorney, and every answer has a bunch of caveats (disclaimers).

Children under 18 —

Car. If your child is under the age of 18, you own everything that is “his.” So if you buy a car for your son and give it to him for Christmas, if he’s under 18, you have to be on the title. If you are on the title, then it’s yours.

Cash and Bank accounts. When you set up a special bank account that is for your 6 year old daughter, the bank will require you to be on the account, because she is a minor. So let’s say you give her $500 for Christmas and deposit it into her account. In your mind, it’s her money, and she can use it for whatever she wants. She’s 6! it’s your money.

Electronics. My 6 year old desperately wants a $50 drone for Christmas. I know this will end up badly, but I’m going to get it for him. The bk trustee won’t care about a $50 drone. On the other hand, if you buy your 14 year old a $1,000 iphone, that’s a problem. She’s under 18, so the phone is yours, and the bk trustee may be interested in it.

Children over 18 —

You have to be very careful with giving gifts of substantial value to anyone before you file bankruptcy. In an extreme example, I’ve had a client who “gifted” her $15,000 truck to her brother one month before filing bankruptcy. She didn’t tell me about it. At the 341 Meeting of Creditors, her Chapter 7 Trustee definitely had some questions!

For a more realistic example, the bk trustee can scrutinize anything you give away before filing bankruptcy. This may be the year to give a card with a heartfelt poem, or even some of those personalized socks with your face on them. If you give $500 to each of your 4 children, that’s $2,000 that you gave away before filing bk. There is a good chance that the bk trustee will want to get that money back to pay your creditors.

Presents from someone else (like Grandma and Grandpa) If your child is under 18, that is your property. There is still a chance that the bk trustee will take it.

It sounds awful, but it’s the bk trustee’s job to review your assets (including gifts and transfers) to see if there is anything she can use to liquidate and pay off your creditors. If you have a question, you should ask your attorney before you make the transfer.

Where do I pay my bankruptcy court filing fee in Utah?

You’ve got a few options. Just remember that if you are late, your case gets dismissed!

When you file bankruptcy, you are required to pay a filing fee to the court (generally $310 for a chapter 13 or $335 for a chapter 7). Some people pay it up front, but most people make those payments in installments to the court after filing. Here is the court website dealing with filing fees:

So let’s say that you filed a chapter 7 today, you could pay the court filing fee as follows:

$100 in 2 weeks

$100 in 4 weeks

$135 in 8 weeks.

The big problem arises when people actually try to make the payment. Here are the payment options that they will accept:

cash, and U. S. Postal Service money orders, cashier’s checks, travelers checks (payable to U.S. Bankruptcy Court), attorney or law firm checks (payable to the U.S. Bankruptcy Court) and American Express, Discover, MasterCard, and VISA for payment of fees.

Here is where you can make the payment:

  1. Online — There is NO online option. No, you cannot pay it online.
  2. Phone — You can call the bankruptcy court clerk at 801-524-6687 and make your payment over the phone using a debit card or someone else’s credit card. Just remember that they close their office by (or a little before) 4:30 p.m.
  3. Mail — If you really want to trust the vagaries of using actual snail mail, just make sure that you send it on time, with the right address, with the right amount. Please note that it’s a bad idea to try to pay through the mail.
  4. In Person — You can drive to the Bankruptcy Court at 450 S. Main, Salt Lake City, UT 84101, go through the security checkpoint, and pay the clerk in person on the third floor at the clerk’s office.
  5. Your Attorney — This might seem like a great idea for you: pay your attorney and he’ll make the payment for you. It’s not really a good idea at all. If you drive to your attorney’s office on the day the payment is due with cash in hand, he may or may not be in and may or may not have this payment on his radar. Pay it yourself; it’s much safer.

Honestly, just pay them over the phone the day before the payment is due. It’s clean and simple.

What are the current firearm (gun) exemptions in bankruptcy for Utah (2019)?

Much, much better than they were.

Now, I can protect any three guns of any value.

Three .22s you use to take the scouts out shooting, 3 shotguns because you really like having a sore shoulder on weekends, or even 3 Barrett 50 caliber sniper rifles (even though I’d wonder what kind of varmits you were hunting with those!).

i met with a client today who had retained a different attorney for his Chapter 7 Bankruptcy. That attorney doesn’t handle many bankruptcies, and he told the client that he could protect one of each type of gun (shotgun, pistol, rifle). The client had 2 shotguns and a handgun, and the attorney directed him to sell off on of the shotguns or risk losing it. The attorney was wrong.

The law states “any three of the following….” “Any” is a pretty broad word.

Here is the actual statute:

78B-5-505.  Property exempt from execution.

except for curio or relic firearms, as defined in Section 76-10-501, any three of the following:
(A) one handgun and ammunition for the handgun not exceeding 1,000 rounds;
(B) one shotgun and ammunition for the shotgun not exceeding 1,000 rounds; and
(C) one shoulder arm and ammunition for the shoulder arm not exceeding 1,000 rounds;

I just received notice that they’re foreclosing on my timeshare that I surrendered in bankruptcy years ago. What’s going to happen to me?

Absolutely nothing. You’re safe.

Today I received a phone call from a client who had a successful Chapter 7 case 3 years ago (successful because she received her discharge). Creditors have been quiet for years. Then, out of the blue, she receives a certified letter with the above foreclosure notice. Thankfully, she called me right away.

She did surrender this liability years ago. However, the timeshare company never bothered doing anything with it (probably because it was worthless). Now, they are selling it off, and they are required by law to notify her.

This does NOT mean that she will have a foreclosure on her credit. They will NOT be able to sue her for any deficiency balance. We gave this up years ago and wiped out the debt. The certified letter gave her notice only: she doesn’t have to respond or do anything else.

What are the median income figures for bankruptcy in Utah (August 2019)?

Basically, if you are over, then you are a chapter 13.  If you are under, then you are a chapter 7.

So I just refunded a retainer payment to some clients who didn’t understand the difference between net and gross. With one child, the magical median income number was $78,581. They told me that their income was sitting at $72,000, so it should have been a simple chapter 7. Once they sent in their paystubs, it showed that they were pulling in $98,000 a year (gross). With payroll deductions, they were netting $72,000 a year (net).When I ran their income figures through my 6 month paystub analysis, Form 122 showed that they had over $2,000 a month left over to pay their creditors off. That means that they would have to be a chapter 13 with a repayment plan of up to $2,000 a month. They didn’t like this development at all, and I refunded their money.

Now remember that these numbers can be adjusted by child support payments (received or made), larger mortgages, huge tax debt, etc.  It is a gross overgeneralization to say that if you are over that figure then you MUST be a chapter 13, but this is the baseline we start with.  That being said, here are the current figures for Salt Lake County that we use on our Form 122 (6 month average of current monthly income and disposable income):

Single:      $62,535

Married:    $68,269

Married with 1 child:   $78,581

Married with 2 children:  $88,835

Married with 3 children:  $97,835

Married with 4 children:  $106,836

Married with 5 children:  $115,835

Married with 6 children:  $124,835

Married with 7 children:  $133,835

Married with 8 children:  $142,835

Married with 9 children:  $151,835

Married with 10 children:  $160,835

If you have more than 10 children, you’re probably going to be below median.  I have 11 children, and I know how expensive that can be.

I discharged my second mortgage in a chapter 7 bankruptcy years ago. Now they are threatening to foreclose. Why?

No, you didn’t.

Well, technically, you did discharge your personal liability for that second mortgage, but it was and it is still attached to your home.

When you file a chapter 7 bankruptcy, it discharges almost all of your debt, including your mortgages. However, this just discharges the debt from you personally. If the debts are secured by a house, you still have to keep paying those debts if you want to keep the collateral.

You can chose to reaffirm the debts and re-assume personal liability for them. That way, they report positively on your credit. Or, you can keep that personal discharge but still keep making payments on the loans. So long as you keep paying the mortgages, you will keep the home. Eventually, you’ll even pay if off and own the title, free and clear.

However, just because you received a personal discharge doesn’t mean that the mortgage was discharged from your home.

In a chapter 7, you can strip (remove) non-consensual liens, like judgments, from your title. You cannot strip consensual mortgages. This means that you cannot strip or remove a mortgage that you signed and agreed to.

Now in a chapter 13, you can sometimes remove a 2nd mortgage if there was no equity in your home to secure that second mortgage. However, that involves some fairly complicated court filings, and you would know if that had happened.

If you receive a friendly phone call from your 2nd mortgage lender advising that you are in arrears for missed mortgage payments, you need to either work out a repayment plan with them directly, or maybe even file a chapter 13 to catch up on those missed 2nd mortgage payments. Otherwise, they can and will foreclose on your home.

That being said, they can take the home, but they cannot sue you personally, because your personal liability for the 2nd mortgage was discharged by your chapter 7.