Whether you are filing a chapter 7 or chapter 13 bankruptcy, trustees are assigned to your case when you file, and they have important duties that they must perform. They review and finalize your financial documents, they make sure your financial information is correct, and they can also propose to the Court to have your case dismissed. Trustees have a huge impact on your case because of their responsibilities and obligations, so it is important to understand what they do. The role of a trustee was created so that creditors and courts would not have to be responsible for collecting a debtor’s property. Depending on the type of case, as well as the circumstances of a particular debtor, the trustee does different things.
In a chapter 7 bankruptcy, the trustee is responsible for rounding up all of the debtor’s property, selling the bankruptcy estate’s property, if applicable, challenging creditor’s claims, distributing proceeds to creditors and objecting to a bankruptcy discharge where they see fit. If you have nonexempt property that has to be sold in the bankruptcy, the proceeds are used to repaid to creditors. The chapter 7 trustee decides if your property will be sold to pay a portion of your debt.
In a chapter 13 bankruptcy, debtors keep possession of their property during the course of the bankruptcy. A trustee’s duties in this type of case deal with handling payments, reviewing the debtor’s proposed repayment plan, making objections to the plan if they see fit, receiving and collecting payments from the debtor according to the repayment plan, and distributing payments to creditors. A trustee will oversee your repayment plan and ensure it is reasonably affordable and they hold the meeting of creditors in a chapter 13 bankruptcy.
Once you have filed for bankruptcy, you may not meet your trustee until the meeting of the creditors. This is also known as a “341 meeting” where it is mandatory for you to attend. During the meeting, your trustee and creditors ask questions regarding your financial situation and bankruptcy documents. Here at DAL Law Firm, we can help with the process and answer any questions you may be unclear about. Contact us today for a consultation at (206) 408-8158. We look forward for helping you today!