In bankruptcy cases a bankruptcy trustee is a court-appointed impartial officer who is charged with administering the debtor's estate. The trustee is appointed by the Department of Justice's United States Trustee and serves as a representative of creditors and protects their interests both in cases filed under Chapter 13 and Chapter 7. Thir role also involves Trustees are generally attorneys who have vast experience in bankruptcy laws. They have a varied role that includes collecting estate property, court appearances, objecting to discharge and objecting to exemptions claimed by a debtor. They are also charged with liquidating non-exempt estate property which can be distributed to the creditors. They role requires them to make sure that the debtor perform under the plan, and don't default on payments. Let us analyze their roles in Chapter 13 and Chapter 7 bankruptcy cases in detail.
If the bankruptcy case has been filed under Chapter 17 the trustee's role involves reviewing and administering the reorganization plan that is submitted to the court by the debtor and verifying fairness and accuracy. Once the repayment plan has been submitted to the creditors the law allows them to challenge the plan at the Creditors' Meeting. This meeting is presided over by the trustee and not by the judge. During this meeting the trustee and the creditors questions the debtors under oath. The trustee notes down all the aspects of this meeting and forwards recommendations to the judge. These recommendations play a significant role during the judge's confirmation hearing where the repayment plan can be accepted or rejected. If the plan is accepted the debtor hands over the monthly payments to the trustee who distributes it to the creditors.
When the bankruptcy case is filed under Chapter 7 the primary role of the trustee is to distribute the debtor's non-exempt property to creditors in accordance with the priority scheme of the Bankruptcy Code and administer the estate of bankruptcy. The role generally involves collecting assets, selling them, and distributing funds to creditors. In such cases the trustee has the duty to preserve sales proceeds until making payment on creditor claims. The trustee also reviews schedule of assets and liabilities of the debtor and also looks into the exemptions that may be requested by the debtor. The trustee also oversees the domestic support obligation of the debtor. The trustee also has to attend the Creditor's meeting and ensure that the bankruptcy case follows standard procedures as laid down by the law. The trustee also has the power deny the debtor the privilege of discharge if he or she finds evidence of evidence of perjury, fraud, malfeasance, or ineligibility under applicable statutes.
As a debtor who files a bankruptcy case you need to always keep in mind that the Trustee is assigned to look into the interest of the creditors. Thus you need to hire the services of a professional bankruptcy attorney who shall take care of your interests as these cases can be very stressful.
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