A bankruptcy trustee is assigned to every Chapter 7 and Chapter 13 bankruptcy case. A trustee has a significant impact on a debtor’s case, but the exact role that a trustee plays in a bankruptcy proceeding is often uncertain. The Justice Department appoints a trustee for each bankruptcy who will often be a lawyer with significant experience in handling bankruptcy.   Chapter 7 and Chapter 13 Bankruptcy   The role of a trustee changes on the type of bankruptcy involved.   Chapter 7 Bankruptcy. In these types of bankruptcy filings, the trustee administers the bankruptcy estate and distributes any non-exempt property to creditors. The trustee is paid through a percentage of any funds that are given to creditors. As a result, in situations where the debtor has no non-exempt assets, the trustee is paid a small amount. Chapter 13 Bankruptcy. The trustee in Chapter 13 bankruptcies is tasked with reviewing and following the Chapter 13 payment plan and distributing any payments made by an individual to creditors. A Chapter 13 trustee collects a percentage of funds paid through the payment plan.   The Role of Trustees in a Bankruptcy Case   A trustee often has several responsibilities in a bankruptcy. [...]

Operating a business creates a variety of challenges. Some business owners face great odds in launching a business or reaching the point of financial gains. With the many costs that businesses face, it is no surprise that many business owners face financial challenges. Facing personal debt in addition to financial problems with a business frequently results in individuals facing substantial challenges. Fortunately, bankruptcy offers several options for relief for business owners. Available Bankruptcy Options for Business Owners Many business owners are able to select between three bankruptcy filing options. There available bankruptcy options for business owners include the following: Chapter 7 Bankruptcy. This type of bankruptcy results in operations of the business ceasing. Creditors of the business will receive notice that the business is no longer operating and any remaining assets are liquidated by a bankruptcy trustee then divided among creditors in order of highest priority first. A business owner will still be liable for some of the business’s debt provided that there were not sufficient assets to pay creditors in full at the time that Chapter 7 bankruptcy is declared. This option is most often selected by sole proprietors, general partnerships, and even some corporations. Chapter 11 Bankruptcy. In [...]

A large number of people are frightened from Chapter 13 bankruptcy due to the belief that an individual will be required to pay part of their of their debts. This type of payment plan under Chapter 13 bankruptcy is often helpful with secured debts which cannot be discharged through bankruptcy. A Chapter 13 monthly payment plan is often used to pay secured debts for collateral that a person wants to keep like an automobile or private residence. If you are involved in a Chapter 13 bankruptcy proceeding, it is often a wise idea to understand exactly how these amounts are calculated. Calculating a Minimum Monthly Payment   The amount of a minimum monthly payment plan depends on what type of debts a person owes. Some types of debts must be paid in full through a repayment plan, which means that an individual frequently must propose a plan that pays off all of these debts within 60 months regardless of one’s income or expenses. While a Chapter 13 payment plan must be large enough to make certain required payments, the payments must be large enough to satisfy certain required payments. In arriving at the amount that is likely due in a [...]