Every Chapter 7 or Chapter 13 bankruptcy filing requires a 341(a) Meeting of Creditors. While your creditors are notified of this meeting, in practice creditors rarely attend. Instead, generally the only people present at this meeting are you, your attorney, and the trustee.
Who is the trustee?
To understand what the trustee might be thinking, it is important to understand the trustee’s unique position in the bankruptcy case. The trustee is not a judge and is usually an attorney. It is the trustee’s duty to review your bankruptcy petition and verify that the information in the petition is accurate. Further, the trustee is responsible for selling non-exempt assets and distributing the proceeds to creditors. Most Chapter 7 cases are “no asset” cases in which all assets are exempt and kept by the person filing. In a Chapter 13 case, the trustee is also responsible for reviewing your payment plan to ensure that the expenses are reasonable and that you have accurately calculated your income.
The trustee is not your attorney
While the trustee is generally an attorney, the trustee is not your attorney. The trustee does not work for you, and is not on your side. Instead, it is the trustee’s job to maximize the value for your creditors. To do this the Trustee in a Chapter 7 bankruptcy will want to look for non-exempt assets that you own in order to pay off creditors during the process. It is for this reason that anyone contemplating bankruptcy should contact an attorney to make certain all assets are protected. Without an attorney, you are left on your own to protect your assets and defend your rights during the process.
What is the trustee thinking?
Chapter 7 bankruptcy trustees are paid an administrative fee that is part of your filing fee. In a Chapter 13 case, the standing trustee is paid a percentage from your monthly payment plan. In a Chapter 7 case, the bankruptcy trustee is eligible for a commission based on how much property he is able to liquidate on behalf of your creditors. This means that trustees have a financial incentive to find and liquidate non-exempt assets. Therefore, if a trustee realizes that you have little or no property to sell, there is no incentive to spend more time on your case chasing down property that does not exist or is of very low value.
The attorneys of Levitt & Slafkes, P.C. know how trustees think. Attorney Bruce Levitt is not only an experienced attorney on behalf of debtors, but has many years of service as a bankruptcy trustee. Because we know how trustees think, the attorneys of Levitt & Slafkes, P.C. are in a unique position to help advise you on how to get the most debt relief from your bankruptcy while keeping thet most property possible.
If you are considering filing for bankruptcy, don’t file alone. Call 973-323-2953 to schedule a free initial consultation with an attorney at We are bankruptcy lawyers who know how to give you a fresh financial start.