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The Bankruptcy Trustee
When a debtor files for bankruptcy, the court creates a what is called a bankruptcy estate. This estate is a collection of all the available assets of the debtor that can be collected by creditors. Everything from property to income is accounted for and the vast majority of it is made available to the court for distribution among the various creditors. When the court creates this estate, the judge will also appoint a bankruptcy trustee to the debtor.
The court tasks this trustee with overseeing all aspects of the bankruptcy estate. Anything from handling the debtor’s business to selling their property and objecting to creditors’ claims is within the purview of the bankruptcy trustee. And while it may seem that a trustee is there to aid in the bankruptcy process on behalf of the debtor, it is important to remember that they are ultimately accountable to the court, not you, the debtor. As a result, it is crucial that you have an attorney that can help you make the right decisions for yourself during this process.
Learn Why You Shouldn’t Represent Yourself.
Chapter 7 vs Chapter 13
The duties and obligations of a bankruptcy trustee vary based on the type of bankruptcy filing and the scope of the estate that the trustee is handling. There are some general duties that a trustee must perform no matter what the bankruptcy case involves:
- Handles any of the debtor’s ongoing court cases involving claims to recover money
- Investigate the debtor’s accounting and finances
- Ensures the proper handling of the debtor’s financial obligations such as domestic support, employee healthcare, etc
- Make a final report to the court regarding the administration of the estate
During a Chapter 7 bankruptcy filing, the trustee has very clear duties with regard to the bankruptcy estate:
- Collecting all of the debtor’s non-exempt assets
- Liquidating all of the debtor’s non-exempt assets
- Distributing money to creditors
- Whenever possible, challenging creditor’s claims
For a Chapter 13 bankruptcy filing, there are very different procedures that the trustee must follow:
- Review and assess the debtor’s plan for repayment of debts
- Objecting, where appropriate, to the repayment plan
- Collecting the payments from the debtor
- Distributing payments to creditors
In all cases, the bankruptcy trustee is required to arrange the smoothest path forward for the court, not the debtor. As a result, it is crucial that you hire a reliable bankruptcy attorney to ensure that you get a fair say. Contact Littlefield Law to discuss your options and bring the best attorney to your case. Call our offices today!
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