Depending on which chapter of bankruptcy you file, the trustee's duties vary significantly. This is owing to the significant differences between chapter 7 and chapter 13 bankruptcy outcomes.
The term liquidation is frequently associated with Chapter 7 bankruptcy. The reason for this is that during the chapter 7 procedure, all of your assets will be liquidated, and the proceeds will be used to repay your creditors. After the liquidation of your assets, you will be released from your remaining debt.
In chapter 7, the function of the trustee is to liquidate the assets. The trustee then utilizes the funds from the liquidation to pay creditors, themselves, and a portion to the debtor.
Chapter 13 bankruptcy is very distinct from chapter 7 and has a very different outcome. Chapter 7 filers must qualify by demonstrating that their income is sufficiently modest. Those who do not satisfy these criteria file chapter 13 bankruptcy. If you have a steady income and wish to retain your assets, you may also file for chapter 13 bankruptcy.
To successfully conclude chapter 13, you must make modified payments on your debts for three to five years. Once these payments have been determined and approved by your trustee, you will begin making them directly to your trustee. It is the trustee's responsibility to distribute these payments to the creditors and retain a portion as compensation. Upon completion of the agreed-upon payment plan, the debtor will be released from the remaining obligation.
If you are considering filing for bankruptcy, you should contact an experienced attorney. They will assist you in determining the most suitable form of bankruptcy for your circumstances.""
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