The Cassidy Law Firm Blog

Thursday, March 20, 2014

Monmouth County Chapter 7 Bankruptcy: What Is the Role of the Trustee?

When you file for bankruptcy in Monmouth County the court handling the bankruptcy will assign a Trustee to oversee your petition. Though the court will remain in control of your petition, you may never step foot in the courtroom and will likely never meet the actual bankruptcy judge. The Trustee, however, will be an important party in your chapter 7 bankruptcy.

Unless you own a small business, farm or ranch, or are a family fisherman, you will choose between a chapter 13 and a chapter 7 bankruptcy when you get ready to file. Most debtors who qualify file a Monmouth County chapter 7 bankruptcy unless they have valuable non-exempt assets they wish to protect in which case they will have to use chapter 13. In a chapter 7 bankruptcy, non-exempt assets can be sold and the proceeds used to repay creditors.

The role of the Trustee in your bankruptcy is an all-encompassing role. Trustees are appointed by the court and have special training to help them fulfill their duties and responsibilities. Some of those duties and responsibilities of the Trustee include:

  • Review documents. The Trustee will review the petition, schedules and any other documents you file with the court for accuracy and completeness.
  • Investigate assets. The Trustee will investigate your finances and assets if he/she is concerned that you might be hiding assets or that you transferred assets just prior to the bankruptcy.
  • Sell assets. If you have non-exempt assets the Trustee will take control of those assets and sell them. The Trustee will then distribute the proceeds to creditors according to priority.
  • Preside over 341 hearing. The meeting of creditors is usually held at the Trustee’s office or in an empty courtroom. The Trustee will preside over the meeting and will ask you basic questions about the petition and your finances. If the Trustee is concerned or suspicious about something he or she may ask more probing questions at the meeting.
  • Act as liaison to court. The Trustee acts as the “go-between” with the court throughout your bankruptcy.

Unless an issue arises that requires the actual court’s attention you will deal only with the Trustee throughout your bankruptcy case. Though each case is unique, the basic process for a  Monmouth County chapter 7 bankruptcy is the same for each case which is why a Trustee is used to help move cases along.

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