Chapter 13 Trustee

A trustee is an official appointed by the bankruptcy court who assists in executing its orders and facilitates the process of payments from the debtor to his creditors. The trustee coordinates the process of debt clearance by keeping in touch with the debtors, creditors, attorneys, judges, and the clerk of the court. His job is to collect payments from the debtors and distribute the money to their creditors. The trustee can charge 3 to 10 percent commission for his services. He may also give financial advice and help the debtors to budget their finances.

The main responsibility of the trustee involves convening meetings between the debtors and the creditors. Besides this, the trustee also ensures that the debt payment plan is practicable so that the debts can be cleared as per schedule. He provides the opportunity to the creditors to ask questions from the debtor. He swears in the debtor to verify and confirm his name, social security number and address, and whether he is married or single. He uses the information provided by the debtor in the court to verify and confirm the same for the benefit of the creditors. He also verifies the payment schedules, property, debts, incomes and expenses of the debtor by showing him the copy of his submissions in the court.

Secured creditors are outside the purview of the trustee. These may include fully secured mortgages, taxes and alimony. Payments for these have to be made directly to the creditors.

The job of the trustee is to ensure that the payments are made to the unsecured creditors. The debtor makes the payments to the chapter 13 trustee by check each month. The trustee then disburses the same to the creditors. These checks bear the docket number allotted by the court to the debtor. If the debtor fails to pay the trustee regularly, he can move the court to dismiss his case.

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