What Happens After the Chapter 7 Meeting of Creditors?

After you and your attorney have met with the Chapter 7 Trustee at the § 341 Meeting of Creditors in Jacksonville, several different things may occur. Your attorney will receive one of several different notifications via electronic mail from the bankruptcy court, which will alert you to the next step in your case.

In many cases, your attorney will receive a “Report of No Distribution.” This means that the exemptions used in your case were sufficient to protect all of your property. The Trustee will be unable to liquidate any of your assets for the benefit of your creditors. This notification is typically one of the last you and your attorney will receive regarding your case. The Report of No Distribution will typically come just days after your Meeting of Creditors.

Your attorney could receive a Notice of Recovery of Assets and Notice of Fixing Time for Filing Claims. This means that the exemptions were not sufficient to cover all of your property, and some will be liquidated by the Trustee for your creditors. If this happens, you and your attorney should discuss whether you would like to try to “buy back” your property or whether you should surrender property to the Trustee.

In either event, a minimum of sixty-one days after your Meeting of Creditors must pass before you are eligible to receive the discharge of your debts. The discharge comes from the judge presiding over your case. The discharge means that the court has found you in compliance with the bankruptcy code and you are entitled to be discharged of your debts. With a Report of No Distribution, your Trustee will likely ask for your case to be closed around the same time as your discharge, and it will be closed.

If you are facing the second situation, you can still receive the discharge of your debt; however the case will not be closed until all of the asset and liquidation issues are completely resolved with the Trustee and your creditors. This process can take up to one year, depending on the settlement agreement reached. Once all of the issues are resolved, your case will be closed.