Under difficult financial times, filing for bankruptcy has increased to epidemic proportions. Many have found that their consumer credit has outpaced their ability to make payments. In short, they find themselves in a position where they need financial relief and an opportunity to start over new.
BRIEF REVIEW OF CHAPTER 13
Filing for chapter 13 bankruptcy means that a debtor potentially has the financial means to pay back some or possibly all of his consumer debt, and wants to hold on to most, if not all, of his property and assets. Under chapter 13 the court assists the debtor by creating a new repayment schedule which usually spans 3 to 5 years. In the process it allows the debtor to retain his residential property on the condition that the debtor continues to make regular mortgage payments. Under chapter 7, if the debtor is unable to pay his consumer debt by liquidating his property and assets, the debt might be discharged through bankruptcy. Under chapter 13, generally all debts are restructured to allow for repayment, although there are certain circumstances where unsecured debt might also be discharged similar to those under chapter 7.
THE BANKRUPTCY TRUSTEE
The United States Trustees assign trustees to those who file for chapter 13 bankruptcy. This individual will be intimately involved in your bankruptcy proceedings. Generally bankruptcy trustees come from a background of law and accounting and are well grounded in the legal procedures involved in bankruptcy law. They know and understand your rights as a debtor as well as the expectation to be given a new financial beginning point. The trustee, however, represents the creditors and their interests, and will work to give them the best settlement possible given your circumstances.
The trustee is responsible for ensuring that you will be able to fully follow the final repayment plan developed under chapter 13 bankruptcy. Additionally, the trustee is the one to whom you will send your monthly payments and the one to disburse those funds to your various creditors.
Keep in mind, though the trustee is heavily involved in the repayment plan established by the court, he is determined to get what is legally possible for your creditors. The trustee is paid a percentage of the money he is able to collect for the creditors in the chapter 13 bankruptcy proceedings.
THE UNITED STATES TRUSTEE
The United States Trustee does not work personally with those who file chapter 13 bankruptcy; his job is to appoint and monitor the trustees he appoints. In cases of fraud and abuse to the bankruptcy system, the United States Trustee is the one who recommends that action be taken by either the Federal Bureau of Investigation or the United States Attorneys. With this authority and responsibility the United States Trustee is essentially the watchdog over the entire bankruptcy process for the United States.
