Filing for bankruptcy requires giving up a great deal of control over your finances. However, if you’re struggling enough to consider bankruptcy, chances are you don’t feel all that much in control as is. Bankruptcy just means another person will take over the management of your money, at least on a temporary basis. This person is known as the bankruptcy trustee.
Bankruptcy trustees are in charge of administering your bankruptcy. They are usually attorneys or accountants who act as officers of the court. Despite being considered neutral, they are primarily working for the creditors to whom you owe money. Trustees are required to abide by rules and laws governing bankruptcy. They must ensure there is no conflict of interest that would call his or her integrity into question.
The role of the trustee varies based on whether you file for Chapter 7 or Chapter 13. This is due in part to the fact Chapter 13 is a longer-term process that includes a payment plan managed over time by the trustee. Trustees follow your case from beginning to end. If there are any changes in your financial situation that affects your bankruptcy, you will need to report this information to the trustee.
Bankruptcy Trustees and Bankruptcy Attorneys are Different
Your bankruptcy attorney works for you. He or she provides guidance and represents you in court. The goal of your bankruptcy attorney is to look out for your best interest and ensure your bankruptcy goes smoothly.
The trustee must also ensure the bankruptcy goes smoothly. However, he or she is concerned with the process, not necessarily your best interest. The trustee focuses on distributing funds to your creditors, while also ensuring your bankruptcy is within the law. Trustees want everyone to be treated fairly. First and foremost, they work to gather as much money as possible for your creditors.
Sharing Information with the Bankruptcy Trustee
You will be asked to provide information to the bankruptcy court, and therefore the bankruptcy trustee, related to your case. This includes your current earning situation, information about your debts, information about your assets and their value, and any additional information that could affect how your bankruptcy is handled.
One of the most important things to remember when you decide to file for bankruptcy is that the trustee assigned to your case intends to recoup as much money as possible on behalf of your creditors. Trustees in Chapter 13 cases even earn a percentage of what they collect during your case, so it is in their personal interest to get as much money as possible from you to put toward your debts. This is one of the many reasons it is so important to have an attorney on your side looking out for you. Trustees have limits, but your well-being is not their first priority, as it is for your bankruptcy attorney.
If you would like more detailed information about the role of bankruptcy trustees, visit the National Association of Bankruptcy Trustees.
For more information or to learn why you need the support of an experienced attorney when you file for bankruptcy, contact the Law Offices of Robert M. Geller at 813.254.5696.