If you have made the decision to file for bankruptcy, you have likely realized that your financial problems have gone beyond what you can address yourself. Moving forward with bankruptcy can be a useful step for you, and you may find yourself on your way to a more stable financial future. Of course, you may still have many questions regarding the process.
First, you need to understand that once you file for bankruptcy, a bankruptcy estate comes into being. This estate encompasses all your property, but it remains a separate entity from you. As a result, someone will need to oversee this estate, and this individual holds the role of a bankruptcy trustee.
What is a bankruptcy trustee?
As mentioned, the trustee will oversee the bankruptcy estate. The trustee is an individual whom the court appoints to handle your case. Generally, this person will handle a number of tasks associated with your bankruptcy proceedings. The exact duties will depend on which type of bankruptcy you filed and the exact details of your particular case.
Trustee duties in Chapter 7
If you filed for Chapter 7 bankruptcy, your allowable property will go through liquidation. In this type of situation, your trustee will carry out the following actions:
- Gathering your property
- Liquidating the estate property
- Objecting to bankruptcy discharge when applicable
- Challenging claims made by creditors when needed
- Distributing proceeds to creditors
Of course, the trustee may also need to take on other duties as needed for your case.
Trustee duties in Chapter 13
With Chapter 13 bankruptcy, rather than liquidating property, you will reorganize your debt to repay creditors. In this case, your trustee will be responsible for the following:
- Reviewing your repayment plan proposal
- Objecting to the plan if it does not meet necessary standards
- Collecting your payments in accordance with your plan
- Distributing those payments to the necessary creditors
In either case the bankruptcy trustee is an impartial individual who works to make sure that bankruptcy proceedings move along as they should. Therefore, you may want to remember that this person is neither against you nor on your side when it comes to completing the bankruptcy process.
The bankruptcy trustee is only one part of the bankruptcy process. If you have more questions about what this person will do in regard to your specific case or if you have concerns regarding other parts of the process, you may wish to consult with an attorney.