Bankruptcy Trustees are experienced financial professionals, often with a legal and/or accounting background.  The Bankruptcy Trustee is a neutral party supervised the U.S. Trustee Program which is a division of the Department of Justice.  The U.S. Department of Justice regularly publishes handbooks of guidelines for the Bankruptcy to follow in both Chapter 7 and Chapter 13 cases. 

 

Generally speaking, the Bankruptcy Trustee's job in the course of your Chapter 7 Bankruptcy is to mine for assets to pay your creditors and report any possible crimes relating to your bankruptcy filing.  In a Chapter 13 Bankruptcy, the Bankruptcy Trustee makes sure that the payment plan complies with bankruptcy laws and that you comply with the plan.    Although the Chapter 7 Bankruptcy Trustee looks for assets to pay your creditors, he or she is not associated with the creditors.

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A Chapter 7 Bankruptcy Trustee will review your petition, schedules and other filings, then request financial documents to review and confirm the accuracy of your petition, schedules, statements of income and expenses and statement of financial affairs.  After reviewing all the documents, the Bankruptcy Trustee may conduct further investigation or request an appraisal of your home and contents, your vehicle, or other property you own. 

 

If, after further investigation or appraisal, the Chapter 7 Bankruptcy Trustee determines that you have property not protected by an exemption, the Bankruptcy Trustee will reach out to acquire the unprotected property or make you an offer to buy back the property from the bankruptcy estate.  In the course of the Bankruptcy Trustee's normal investigation, he or she will question you during a 341 Creditor's meeting.  Generally, if a U.S. Trustee appears at the 341 Creditor's meeting along with the Bankruptcy Trustee, there is an issue with your filings, meaning that your filings may appear to contain false, inaccurate or incomplete information.  Understand that, from the Bankruptcy Trustee's perspective, you are receiving a great deal with a Chapter 7 discharge meaning that, in exchange for the little property you may be forced to give up, you are recieving the relief of tens of thousands, if not hundreds of thousands, of dollars of unpaid debt.

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Because you may retain your assets while filing a Chapter 13 Bankruptcy, the Bankruptcy Trustee's job is more focused on ensuring a legally compliant payment plan and your compliance with the plan.  If you do not make the payments as promised, the Bankruptcy Trustee reports your failing to the Court for further action.

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