Appointing bankruptcy trustees is an important part of the law in Phoenix, Arizona. The Frutkin Law Firm bankruptcy attorneys will help you to understand the vital function that these trustees will serve.
A bankruptcy trustee is a disinterested person who has been reviewed and appointed by the court to assist in resolving bankruptcy cases. Usually, these trustees are attorneys or accountants who are familiar with legal and financial matters. The trustee’s primary purpose is to carry out the orders of the court for repaying creditors in bankruptcy cases. The duties of a bankruptcy trustee vary by the type of bankruptcy filing.
For a Chapter 7 bankruptcy, the trustee will preside over a court-ordered meeting of the creditors where you must answer questions under oath about your assets. Contrary to the name, the creditors in the majority of cases do not show up for this meeting. The Chapter 7 trustee will verify and liquidate all of your non-exempt assets and use the proceeds to pay the creditors as directed by the bankruptcy code.
For a Chapter 13 bankruptcy, in addition to presiding over the creditor meeting, the trustee is responsible for receiving monthly payments from you and distributing them to the creditors as directed by the bankruptcy code. The Chapter 13 trustee will often act as a negotiator between you and the creditors, and it is his responsibility to guarantee that the interests of all parties are represented according to the law. This arrangement will last until the bankruptcy is discharged, typically for 3-5 years.
In all cases, the trustee is charged with making sure that no fraud is committed by the debtor (or the creditors). The trustees are also charged with liquidating the assets for a fair and reasonable price. Trustees in bankruptcy cases are to remain disinterested, and their work and their compensation are matters that can be reviewed by the court. The trustee, while representing the interests of the creditors, is also responsible to follow bankruptcy law and orders of the court.