By the letter of the law, a bankruptcy trustee represents your bankruptcy estate—but what does that really mean? In the game of Arizona bankruptcies, the bankruptcy trustee is sort of like a referee. Their primary job is to use your property to ensure that your creditors get paid, but in order to make that happen, they have to make sure that the “game” is fair. They make certain that the creditors’ claims are legitimate, and at the same time keep your exemptions within limits.
This middle-of-the-road approach can make it feel as though the trustee is a bit of a double agent, but in truth, the best trustees aim to have both creditors and debtors emerge from bankruptcy feeling like their needs were met. The role of the trustee is a bit different depending on whether you have filed for a Chapter 7 bankruptcy or a Chapter 13 bankruptcy. Below, we go over the primary differences:
Bankruptcy Trustees in Phoenix Chapter 7 Bankruptcy
When you first file a petition for Chapter 7, you disclose a lot about your finances to the bankruptcy court, including information about your income, debts, and assets. The bankruptcy trustee enters your case in these early stages to verify that the information you provided is factual and accurate. The trustee will later ask you questions about your petition while you are under oath at your bankruptcy hearing.
Once your bankruptcy case gets underway, it is the trustee’s job to liquidate your nonexempt property in a manner that will pay off as much of your outstanding debt as possible. He or she will also examine your exempt property to make sure that its value is within the limits set by Arizona bankruptcy courts. If you own more than the allotted amount, it is the trustee’s duty to use the overage to pay off your creditors.
The Middle Man: The Trustee’s Part in Your Phoenix Chapter 13 Bankruptcy
If you are filing for a reorganization bankruptcy, the trustee’s job will look very similar to the early stages of a Chapter 7 bankruptcy—reviewing your petition and running your creditor’s meeting. Once your repayment plan is underway, the trustee will act as the “middle man;” you will send your monthly payments to the trustee, and he or she will distribute the payments amongst your creditors. The trustee will also keep careful account of how much each creditor been paid over the course of your plan.
Choosing a Phoenix Bankruptcy Attorney Who is 100% on Your Team
While a trustee represents your bankruptcy estate, he or she is also obligated to represent your creditors. With your future depending on the success of your bankruptcy, it is important to have an attorney that is completely focused on representing only you. The Arizona bankruptcy lawyers at Curry, Pearson & Wooten are heavy hitters that will fight for your best interests—call at 602-258-1000 or toll free at 888-929-5292 today to speak with one of our attorneys.