Trustee in bankruptcy

From Wikipedia, the free encyclopedia

A Trustee in Bankruptcy is a person who is appointed by the judge or by the creditors involved in the bankruptcy case. The trustee must be a licensed insolvency practitioner who is registered under the United States Bankruptcy Act. In a Chapter 7 Bankruptcy the trustee is to gather the debtor’s non-exempt property or all of his assets, managing the funds from the sale of those assets, and then paying expenses and distributing the balance to the owed creditors. However, in a Chapter 13 Bankruptcy the trustee is responsible for receiving the debtor’s monthly payments and then distributing those funds proportionally to the bankrupt’s creditors. The Bankruptcy Trustee will act on behalf of the debtor to guarantee that both the creditors’ and the debtor’s interests are maintained in accordance with the bankruptcy laws, and will often be required to act as a negotiator between the two parties.