Role of the Trustee in Florida Bankruptcy

If you are facing substantial debt in Florida, bankruptcy may be a solution that can help you recover financially. It’s not right for every scenario, though, so before choosing to file for bankruptcy, it is essential to understand how the process works.

One important part of the process in Florida is the role of a bankruptcy trustee. These individuals, assigned by the court, are the key to a successful bankruptcy filing — for both the debtor and the creditors.

What a Bankruptcy Trustee Does in Florida

A bankruptcy trustee is not a lawyer or a judge. They are an individual assigned by the court to facilitate bankruptcy proceedings and ensure they are as fair as possible. 

A bankruptcy trustee must remain impartial throughout the proceedings. What they specifically do during those proceedings depends on what type of bankruptcy you are filing.

Chapter 7 Bankruptcy

In Chapter 7 bankruptcy, the debtor liquidates all non-exempt assets, and the proceeds go to their creditors. The role of the trustee in Chapter 7 bankruptcy is to maximize the value of those assets by discovering them and selling them for top dollar.

The trustee has to determine whether assets are exempt and whether they are worth selling. If the cost to sell a non-exempt asset is higher than what it would bring in, the trustee is legally obligated not to pursue it.

Chapter 13 Bankruptcy

Chapter 13 bankruptcy doesn’t involve liquidating assets. Instead, it involves redistributing debt to give the debtor a better chance to pay it off. In a Chapter 13 bankruptcy, the role of the trustee is to determine whether the payment plan is fair to creditors and debtors. They also help with the distribution of funds.

Bankruptcy Trustee Representation in Florida 

At Shrader, Mendez & O’Connell, we give bankruptcy trustees legal guidance as they fulfill their duties under Florida law. Consult our experienced bankruptcy trustee representation attorneys by calling us at 813-360-1529 today.