regaining financial stability after divorce

The bankruptcy trustee involved in your filing has a number of responsibilities, including verifying the financial information you submitted to the court. One method the trustee might use to investigate your finances is the 2004 examination. If the trustee has chosen to complete one in your case, it is important that you understand why so you can ensure your bankruptcy stays on track.

What Is a 2004 Examination?

When you file for bankruptcy, the trustee will hold a 341 hearing. During the hearing, you will need to answer questions about your finances. Creditors also have the opportunity to request that you still be held responsible for their debts. The hearing is usually brief and helps to move your filing to the final stages. 

However, if the trustee feels that more information is needed about your finances, he or she can conduct a 2004 examination. The examination is more detailed and is similar to a deposition. You might be asked to provide additional documentation, such as your most recent banking statements and statements regarding your debt. 

Why Would the Trustee Ask for a 2004 Examination?

One of the most common causes for conducting a 2004 examination is that the trustee has found something in your documentation that violates the rules of a bankruptcy filing. For instance, if the trustee notices that you have large transfers from your bank account to an account not listed, an examination can occur. 

The trustee can also request one if he or she suspects that you are hiding assets, or that you transferred assets prior to filing for bankruptcy. Both are considered to be fraudulent acts and could lead to criminal charges and a dismissal of your filing.

There is also the possibility that the trustee simply needs more information to finish up your filing. For instance, the trustee could request a copy of the certificate showing that you completed the debtor's education course required to complete a filing. 

How Can You Avoid the Examination?

The best way to avoid an examination is to ensure that all of the financial information you have submitted to the trustee is accurate. When it is time for the 341 hearing, take along your latest financial documents so that the trustee has updated information. You should also avoid hiding or transferring any assets. 

A 2004 examination is not automatically a reason to panic, but it is best to avoid one, if possible. The examination could further delay your bankruptcy filing, which delays your ability to move on from this chapter. For more information, contact Licata Bankruptcy.