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.
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).
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 a 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.
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Brenner Spiller & Archer 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.
