Understandably so, it may be difficult to admit that you are undergoing certain financial struggles. But once you overcome this hurdle and declare bankruptcy, what may be harder is letting a bankruptcy trustee access your finances and all the information that comes along with it. Nonetheless, this may be your best bet for achieving long-term financial relief and stability. Follow along to find out the role that a bankruptcy trustee may play in your proceedings and how a proficient Louisville, Kentucky consumer bankruptcy lawyer at Schwartz Bankruptcy Law Center can help this working relationship function harmoniously.
What is the purpose of a bankruptcy trustee?
For starters, a bankruptcy trustee is essentially an administrator of your bankruptcy estate. This individual, appointed by the United States Trustee, may serve a different function based on the consumer bankruptcy type you have opted for. More specific examples are as follows:
- A Chapter 7 bankruptcy trustee may:
- Identify assets in your possession that are considered non-exempt.
- Conducts a means test to determine your ability to pay for your unsecured debts.
- Liquidate your non-exempt assets and distribute the money raised to respective creditors.
- A Chapter 13 bankruptcy trustee may:
- Calculate whether you have the financial means to qualify for this consumer bankruptcy type in the first place.
- Ensure that creditors get paid back the same amount as they would have if you filed for Chapter 7 bankruptcy instead.
- Collect your monthly installments, as per your established repayment plan, and distribute them to respective creditors.
What investigations might a trustee conduct against me?
To reiterate, one of the primary roles of a bankruptcy trustee is to monitor your activity throughout your proceedings. In other words, this individual may keep a watchful eye and look out for any major red flags that may pop up. More specific examples are as follows:
- This individual may investigate whether you are misclassifying any non-exempt assets as exempt assets (specifically in a Chapter 7 bankruptcy).
- This individual may investigate whether you are claiming disqualifying assets or omitting relevant debts (specifically in a Chapter 13 bankruptcy).
- This individual may investigate whether you have been hiding assets throughout your proceedings (missing financial records, recent property transfers, closed bank accounts of investment accounts, etc).
It does not matter if any of the aforementioned actions are not done deliberately but rather done by accident. This is because, if a bankruptcy trustee suspects such fraudulent activity, then the Federal Bureau of Investigation or another law enforcement entity may become involved. Ultimately, this may result in criminal penalties.
With these investigations in mind, you must not wait too long to retain the services of a talented Louisville, Kentucky consumer bankruptcy lawyer. So please call Schwartz Bankruptcy Law Center at your earliest possible convenience.