In Chapter 13 bankruptcy, who is this mysterious player called the Chapter 13 Trustee?
The Chapter 13 Trustee is an attorney who is hired by the United States Bankruptcy Trustee to basically ensure that everyone is playing by the rules. In addition, the Chapter 13 trustee is the person who collects money from the debtor and distributes it to creditors.
The Chapter 13 trustee gets paid by collecting roughly 5.5 percent of the debtors Chapter 13 payment as a fee.
In the Northern District of Georgia in the Rome division, we are blessed with a very nice Chapter 13 Trustee named Mary Ida Townson. She does not ridicule or harass people who file for bankruptcy. However, if any debtor tries to game the system or pull a fast one, she will not hesitate to lower the boom.
A debtor’s first interaction with the Chapter 13 trustee is the 341 meeting of creditors. In the Rome division of the Northern District of Georgia, this meeting takes place on the first floor of the Federal Building in downtown Rome approximately 30 days after the case is filed.
During this hearing, it is not uncommon for the trustee to announce her objections to the Chapter 13 bankruptcy case. In most cases, these objections can easily be fixed after the debtor meets with their bankruptcy attorney.
During this hearing, it is important that the debtor remembers to answer questions with a clear “yes” or “no” so that the recorder can pick up the answer. As a general rule, the trustee will want simple short answers to her questions. When she wants more detail, she will clearly ask for it.
Many Chapter 13 debtors come to court feeling extremely nervous. “When I say, there is no need to be nervous,” I usually get the response, “Hey, that is easy for you to say because you come to bankruptcy court all the time.”
However, the reason most people feel nervous is because they are afraid that some mysterious controversy will arise out of nowhere and sink their case.
The reason this will not happen to my clients is because I believe that every debtor should spend at least two hours with their bankruptcy attorney reviewing the bankruptcy petition before the case is filed. It is imperative that both the debtor and their bankruptcy attorney carefully review every single page of the petition. If there is something that will blow up your case, we will find it before the case the is filed.
When you carefully review everything before filing a case, there will not be any surprises when you go to court and meet your Chapter 13 bankruptcy trustee.