What is a debtor’s exam?

A debtor’s exam, also known as a creditor’s exam, is a legal tool in Tennessee that creditors use to investigate a person or business that have failed to pay debts. These exams normally take place in a courthouse, with an authorized representative of the creditor in attendance, and require the debtor to answer questions about their finances. Questions may include inquiries about a debtor’s income, savings, debts, and other assets. The exam is used to help creditors gain a complete understanding of a debtor’s financial situation. This information is used to figure out whether a debtor has the ability to pay the debt and/or if the creditor should take legal action to recover the debt. In Tennessee, creditors are required to give advance notice of the exam, informing the debtor of the date, time, and place where the exam will take place. They must also inform the debtor of their right to be represented by an attorney during the exam, and any fees in regards to the exam must be reasonable and agreed upon in advance. Debtors may refuse to be examined, but this could make a court more likely to approve a creditor’s motion for legal action to recover the debt. As such, it is typically in a debtor’s best interest to participate in the exam.

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What is a debtor’s exam?

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