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3 Things a Case Trustee Does During Chapter 7 Bankruptcy

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3 Things a Case Trustee Does During Chapter 7 Bankruptcy

When a person files for chapter 7 bankruptcy, a case trustee is appointed to manage the bankruptcy estate. This role is filled with a multitude of tasks and responsibilities and it’s complicated to try and offer a brief summation. To describe everything would be tedious, but the following are three of the biggest tasks a case study handles during the course of a chapter 7 bankruptcy (Based on this article by the Federal Courts).

Image of a wallet being squeezed shut to demonstrate chapter 7 bankruptcy. 1) Liquidation

Sells the debtor’s non-exempt property and other belongings in order to pay off creditors. Filing chapter 7 means you’ll most likely be selling off your home. Selling a house may be perfectly fine for many, but for others it’s deal-breaker. If you’re thinking of bankruptcy but still want to keep your house, it’s better to consider chapter 13 bankruptcy.

2) Recover Money and Equity

Trustees have the power to do a number of things in an effort to reclaim some of the debtor’s money or estate. This includes setting aside preferential transfers to creditors, undoing security interests and other prepetition transfers of property, and pursuing non-bankruptcy claims such as fraudulent conveyance and others. Learn more here.

3) Operates Business

If it helps with the process of paying off creditors and the liquidation, the trustee might run the debtor’s business for a brief period. This includes undoing security interests among other pursuits and remedies.

These are only a few of the many things case trustees do and these descriptions do not serve as complete descriptions. In addition, this article should not be taken as legal advice. If you’re considering chapter 7 bankruptcy or another legal option, you need to consult an attorney for guidance. If you’re in New Jersey and seeking legal assistance, we can help you.

Brenner Spiller & Archer, LLP is a New Jersey law firm that is dedicated to helping families find relief from the burden of debt and other financial woes. For more than 35 years, our bankruptcy lawyers have provided effective guidance on all debt relief matters to clients throughout Central and South Jersey.

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