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Trustees handle many different tasks

On Behalf of | Feb 5, 2020 | Bankruptcy |

Ohio residents who file for bankruptcy will have their assets placed in a bankruptcy estate. The estate is a separate entity that is overseen by a trustee, and his or her exact duties will vary based on the circumstances of a given case. If a person files for Chapter 7 bankruptcy, a trustee will be tasked with gathering a debtor’s non-exempt property, selling it ,and distributing the proceeds to creditors.

The trustee could also be tasked with challenging claims made by creditors or challenging an attempt to have a case discharged. In a Chapter 13 case, a trustee plays a role in reviewing and approving a debtor’s payment plan. This person may be allowed to object to a plan if there is reason to do so. If a repayment plan is approved, a debtor will make payments to the trustee, and he or she will distribute the proceeds received to creditors.

The consequences of filing for bankruptcy may vary depending on the exact details of a case. For instance, an individual may be able to file for Chapter 7 bankruptcy and have most unsecured debts discharged without losing property. In a Chapter 13 case, a debtor may be able to ask for a cramdown or sell an item before it is repossessed.

Regardless of what type of bankruptcy protection a debtor seeks, the trustee assigned to the case will play a key role in the proceeding. This person may reject a filer’s ability to have debts discharged or obtain new debt while a case is ongoing. If a debtor disagrees with a trustee’s ruling, it may be possible to challenge it in court. An attorney may be able to assist with a legal challenge or take other steps to help a person get through the bankruptcy process.