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The term “Trustee” in bankruptcy is an often confusing term. The term has different meanings depending on the context within any given bankruptcy. The United States Trustee’s Office is a component of the United States Justice Department responsible for the oversight and administration of bankruptcy cases. The “U.S. Trustee” is involved, to some degree or another, in every bankruptcy case filed in the United States. Generally, the U.S. Trustee’s involvement in a bankruptcy case is in the background and only becomes “visible” when there is a suspicion of fraud or another irregularity in the case. In general, when the term “Trustee” is uttered in a personal bankruptcy context it refers to either a “Chapter 7 Trustee” or a “Chapter 13 Trustee”.
In each Chapter 7 bankruptcy case the U.S. Trustee appoints a “panel trustee” or Chapter 7 Trustee to oversee and administer the case. In this case the Trustee’s job is to meet with the debtor, her attorney, and any creditors that who attend a Meeting of Creditors pursuant to 11 U.S.C. § 341(a). The Trustee determines whether she believes there to be assets available to creditors, which the Trustee pursues, liquidates and reduces to cash. The Trustee then administers all claims filed in the case and distributes the resulting cash to unsecured creditors.
Each Chapter 13 bankruptcy case is administered by a Chapter 13 trustee. There is usually one Chapter 13 trustee for each “jurisdiction” or “division”. Massachusetts has a total of two Chapter 13 trustees – one for the “Eastern Division” and one for the “Central Division” and “Western Division”. The Chapter 13 Trustee’s duties are similar to the Chapter 7 trustee in that she administers the case, runs the Meeting of Creditors pursuant to 11 U.S.C. § 341(a) and distributes cash to creditors. However, unlike in Chapter 7, a Chapter 13 Trustee does not liquidate any assets. Instead, the Chapter 13 debtor and her attorney propose a plan of repayment of some debts. The Chapter 13 Trustee collects those monthly “plan payments” from the debtor over the course of three to five years, and distributes the amounts collected to creditors.
The Law Offices of James Wingfield is experienced in all types and can help you to decide which, if any, type of bankruptcy is right for you. Call us at (508)797-0200, email us, or visit our contact page to schedule a free, confidential initial consultation.
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The Law Offices of James Wingfield is proud to be a debt relief agency. We help the individuals, families and small businesses of the Worcester area file for bankruptcy relief under the United States Bankruptcy Code. The Law Offices of James Wingfield serves Central and Western Massachusetts clients in Worcester County, Hampden County, Hampshire County and Middlesex County including Worcester, Shrewsbury, Springfield, Westborough, Southborough, Framingham, Northampton, Natick, Amherst, Fitchburg, Leomister, Douglas, Uxbridge, Gardner, Belchertown, Holyoke, Wilbraham and Chicopee. The information contained and obtained in this website does not, nor is it intended to be, legal advice. Contacting us, be it through this website, via email of by telephone does not create an attorney-client relationship. An attorney-client relationship is only created upon execution of an engagement agreement or fee agreement.