When you file for bankruptcy protection, the U.S. Bankruptcy Court will assign a bankruptcy trustee to your bankruptcy case. Bankruptcy trustees are an important function of your bankruptcy, and according to many bankruptcy attorneys in California, your success in having your debts discharged lies firmly in the lap of your bankruptcy trustee. The bankruptcy trustee’s job is to serve as a neutral party who protects the rights of both the debtor and their creditors.
The Role of a Bankruptcy Trustee
In a Chapter 7 bankruptcy, the trustee is tasked with collecting, itemizing, and selling nonexempt property and then dispersing the proceeds of those sales to the creditors listed in the bankruptcy. During the course of a Chapter 13 bankruptcy, the trustee evaluates the debtor’s bankruptcy repayment plan, and takes appropriate actions should the repayment plan not be feasible. This usually involves filing an objection with the U.S. Bankruptcy Court that the bankruptcy is filed in, asking the court to deny confirmation of the plan. Additionally, once a Chapter 13 bankruptcy case is confirmed, payments are made to the bankruptcy trustee who then, in turn, pays the creditors.
341 Meeting or Meeting of Creditors
The bankruptcy trustee is present for the one primary court appearance that all bankruptcy filers must attend called the 341 Meeting of Creditors. This meeting is typically comprised of the individual that filed bankruptcy, your Rocklin bankrupt lawyer, and the bankruptcy trustee. During the meeting, the bankruptcy trustee will be responsible for placing the parties under oath, verifying your identity, asking questions to ensure the accuracy of the bankruptcy petition, and allowing any creditors that showed up to ask questions about the bankruptcy case. For a Chapter 7 bankruptcy case, this is typically the only contact one will have with the bankruptcy trustee, while during the course of Chapter 13 bankruptcy, the trustee may reach out with requests for certain documents such as tax returns.
While a bankruptcy trustee is appointed to ensure the accuracy of bankruptcy petitions and reviewing all the paperwork submitted, their true objective is to maximize the amount of money that unsecured creditors receive in the bankruptcy case. Bankruptcy trustees go to great lengths to investigate finances for those seeking bankruptcy protection, and so your bankruptcy case will go quite smoothly if you are willing to work honestly with the trustee to turn over all non-exempt property.