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Whether it be a chapter 7 bankruptcy case or chapter 13 bankruptcy case, there will be a bankruptcy trustee appointed to your case, who will have various rules and obligations. He or she will oversee your entire case and help the court make a judgment.
The bankruptcy estate and the bankruptcy trustee
To understand what a bankruptcy trustee does, you will first have to know what bankruptcy estate is. It is created after a debtor files for bankruptcy and it consists of all the debtor’s non-exempt properties. It has its separate role in the case.
A bankruptcy trustee is a person who takes care of the bankruptcy estate and follows the law and oversees the whole case as a whole. He or she has some specific laws set in for a specific type of case but his/her duties entirely depend on the situation that the specific debtor and his creditors are in.
The duties of the bankruptcy trustee are somewhat similar in both chapter 7 and chapter 13 bankruptcy but there are some differences. Here are some of the basic duties of both the chapters-
Some of the primary duties of the bankruptcy trustee in a chapter 7 case are-
- Assembling all the debtor’s properties in one place (bankruptcy estate).
- Selling the bankruptcy estate.
- Challenging creditors’ claims where necessary.
- Distribution of the funds collected among the creditors.
- Objecting a bankruptcy discharge if some fraud or anything illegal is found.
Some of the primary duties of the bankruptcy trustee in chapter 13 case are different than of chapter 7 as here there is no liquidation of properties rather it is a repayment plan, so mainly the trustee’s work is to handle payments but some of the other duties are-
- Review the plan proposed by the debtor and object to the plan proposed if necessary.
- Collection of payments from the debtor according to the repayment plan and distributing it among the creditors.
The bankruptcy trustee plays a major role in a case, he/she can object to anything in the case while reviewing the claims from the creditors as well as the debtor.
Are Bankruptcy Trustees Federal Employees?
The bankruptcy trustee is someone who is appointed by the United States trustee who is an employee of the department of justice.
But, some private trustees oversee cases but are not government employees themselves.
If you want good legal counsel and if you live near Los Angeles & Dallas, TX, reach the Recovery law group – (888-297-6203).