If you file for bankruptcy, regardless of whether you file for Chapter 7 or Chapter 13, the court will appoint a bankruptcy trustee to your case. Bankruptcy trustees are not lawyers (although some trustees go on to be lawyers), and do not work for creditors. They are there to be an impartial third party responsible for facilitating your case and making sure that everything goes smoothly.
If you file Chapter 7 bankruptcy, it is the trustee’s job to collect information from you about all of your property, and then to liquidate any non-exempt assets in order to pay your creditors. It is his or her responsibility to allocate money to your creditors as fairly as possible. All you have to do is turn over any assets you have, and the rest is up to the trustee.
In the case of Chapter 13 bankruptcy, the role of the trustee is similar because he or she must still gather information about your financial situation. From there, he or she is in charge of overseeing the payment plan you and your lawyer have drawn up, and will then facilitate that plan. So, you will give a certain amount of money to the trustee every month, and he or she will pay a certain amount to each of your creditors.
How Does a Bankruptcy Trustee Help Me?
A trustee is appointed to be impartial. He or she is not there to fight for you, like your bankruptcy attorney will. Instead, the trustee is supposed to be impartial and to make sure the bankruptcy agreement is fair to everyone.
However, the trustee will object to any false or improper claims your creditors may bring against you. He or she will protect you if your creditors have not filed their claims properly, or if they try to hold you accountable for money not included on their claims. Of course, the trustee can also object to your claims, such as claims for exemptions, in order to keep everything fair for the creditors as well.
The goal of the trustee is to ensure that creditors get the most money possible from your case while still allowing you to wipe your financial slate clean. But the trustee has no power to accept or deny your claim, only to advise the courts. It is the judge who will make the final decisions about your bankruptcy case, and your lawyer who will fight on your side.
Attorney Gary L. Mason has over 25 years of experience helping people with bankruptcy.