What is the Role of a Trustee in a Chapter 7 or Chapter 13 Bankruptcy?
Trustees are assigned by the United States Bankruptcy Court in both Chapter 7 and Chapter 13 bankruptcy cases to help facilitate the process. Their role in the process varies by the type of bankruptcy. Your attorney should primarily be the intermediary between you and the Trustee assigned to your case. Experienced bankruptcy law firms, such as Acclaim Legal Services, have a history of working successfully with the various Trustee offices based on their number of years (over 50 years combined legal experience) administering cases. Bankruptcy Law is generally considered a specialty area of practice. Be sure your attorney handles both Chapter 13 and Chapter 7 cases to ensure that you are getting the most comprehensive advice and the correct debt resolution solution for your circumstances.
What is the Role of a Trustee in a Chapter 7 Bankruptcy?
A Chapter 7 Bankruptcyis a debt elimination program designed to help you eliminated unsecured debts (such as credit card or medical bills) that you can no longer afford to pay. There are requirements to qualify based on your income. We can advise you if you qualify to file a Chapter 7 in Michigan. When filing a Chapter 7, you are able to exempt a certain dollar amount of your assets, such as:
- Equity in your home;
- Vehicles you own;
- Savings account;
- Household goods and furniture; etc.
- Qualified Retirement Accounts (IRA or 401(K))
Most Chapter 7 cases are filed as "no asset" cases, meaning that there are no assets available to liquidate for creditors because the allowable exemptions to cover all personal assets. However the Chapter 7 Trustee's job is to preform an audit of your circumstances. If there are any non-exempt assets, the Trustee's role is to liquidate those assets for the benefit of creditors.
What is the Role of a Trustee in a Chapter 13 Bankruptcy:
A Chapter 13 Bankruptcyis a debt consolidation and reorganization plan designed to help you reduce debt and improve your credit. The Chapter 13 repayment plan is developed by the Debtor and Debtor Attorney and reviewed by all interested parties, but ultimately approved by the court. In our district in Michigan, each Trustee works on a specific court docket versus being randomly assigned by a lottery system such as Chapter 7 bankruptcy. Our firm mirrors this local court structure by assigning a specific attorney and paralegal to work on each specific Chapter 13 court docket. These legal teams have a productive working relationship with their Trustee based on years of working together. Since the attorneys have practiced before the same bankruptcy judges, they are familiar with their rulings and requirements. This helps provide consistently high customer service and the best results for our clients. The specific role of the Chapter 13 trustee is to make sure that the debtors in the case are paying their best efforts to the creditors as outlined in the Chapter 13 plan. Other duties include:
- Review of the petitions and schedules;
- Analyze your creditors "proof of claims" (proof that you owe the debt and the amount you owe) to ensure that it was a properly filed claim;
- Receive and distribute monthly plan payments and distribute the funds per the specifications of the Chapter 13 plan;
- To serve as an intermediary between debtor and debtor's counsel and the creditors involved ensuring that that both parties' interests are upheld in accordance with the federal bankruptcy laws.
Call us for a free evaluation to understand if filing for Chapter 7 or Chapter 13 is right for your circumstances. With over 50 years of combined legal experience in bankruptcy law, you can trust our advice and be assured that we will help you find the right path to debt resolution and financial freedom. Call us at 866-261-8282 or schedule an appointment online.