Posted on: 28 July 2015
If you are considering filing for bankruptcy, you should know that bankruptcy is more of a process than a declaration. There are a series of steps in this legal and financial filing, and overseeing the entire process is the bankruptcy trustee. The trustee is a court-appointed official, usually an attorney and sometimes a judge.
Your only contact with the trustee may be at the creditor's meeting, sometimes called the 431 meeting. The trustee will preside over this open meeting and will ask you a series of questions about your bankruptcy case. You will be under oath, and this meeting will be open, with others also declaring bankruptcy present. Normally, you will be prepared by your bankruptcy attorney to answer the questions, and the meeting will be relatively quick and uneventful.
One of the trustee's most important tasks is the seizing of property to help pay off your debts. In certain instances, the bankruptcy trustee may visit your home to inspect your assets. This commonly occurs if you have valuable assets such as real estate, boats, or jewelry, but can occur even with more modest bankruptcy cases. This visit is scheduled in advance, and you must be present. No property will be removed at that time, but the trustee or an assistant may photograph some of your belongings. While this visit can be nerve-racking, keep in mind that it is just a routine part of the bankruptcy process and is usually quick and painless.
The Trustee's Compensation
The trustee's interest in your case is directly proportional to how much non-exempt property you have. Nonexempt property is your assets that may be subject to seizure to help pay your debts. The trustee's compensation is based on how much of your nonexempt property he recovers. By law, the amount is set at a 25% commission on the first $5,000, a 10% commission for $5,000 to $50,000 and a 5% commission for $50,000 up to $1,000,000. It should be noted that these commissions are based on the recovery amount, which is the amount gained by the sales of those assets, not by their appraised values. The trustee also earns a flat fee for certain administrative functions such as presiding over the creditor's hearing.
Bankruptcy trustees are skilled in locating assets, so as long as you have been forthcoming about your property and have valued it accurately, you have nothing to worry about. Your bankruptcy attorney will have likely already prepared you for your dealings with the trustee, and with the resulting property loss if pertinent. If you have any questions about the bankruptcy trustee, exempt property or other bankruptcy-related issues, contact a bankruptcy attorney at Sever Law Office.Share