Is My Bankruptcy Trustee Working For Me or Against Me?


If you are considering filing for bankruptcy, or already have filed, you have probably wondered about the duties of your bankruptcy trustee.

Does he work for me? Is he against me?

In any bankruptcy matter, the trustee is not “on” anybody’s side. He/she does not represent you or your creditors. The trustee is not “out to get you”, or to either prove or disprove your case.

Every bankruptcy case is assigned a trustee to look over and represent the bankruptcy estate that is created when the bankruptcy case is opened. A bankruptcy trustee is assigned by the Department of Justice, and is responsible for collecting all assets of the NJ bankruptcy estate in order to pay off creditors with valid claims that you owe them money.

Your trustee is expected to remain impartial throughout his/her role as your trustee. Some of the responsibilities that come with being a bankruptcy trustee include:

  • Inspecting all of the paperwork involved in your bankruptcy matter, from the original bankruptcy petition to your tax returns, pay stubs, mortgage paperwork, and information about all of your debts and bank statements. This is the trustee’s first priority during any bankruptcy case, and it is performed so that he/she can verify that all of the information included in the original petition as well as all of your financial documents and papers is accurate.


  • Holding the Meeting of Creditors, also called the 341 hearing. During this hearing, the trustee will ask you any and all questions that he/she may have regarding information in your financial documents. Any of your creditors are allowed to attend this meeting as well, but more usually they don’t. Creditors may attend the 341 hearing if they feel that you are being less than truthful about your assets, but otherwise, this meeting is usually held between you (along with your NJ bankruptcy attorney) and the bankruptcy trustee. During the 341 hearing, you will be under oath, so it is imperative that you answer all of the questions asked by your trustee in complete honesty.


  • Paying your creditors with any of your assets that do not fall under the “exempt” category. This duty is probably the most well-known task that the bankruptcy trustee is responsible for. While you are permitted to retain possession of some of your personal property in a chapter 7 bankruptcy (exemptions), any assets that you own that are above and beyond your exemption amount will be liquidated (sold) by the trustee in order to pay back as many of your creditors as possible.


  • Preventing preferential transfers or interests. In a bankruptcy case, your financial behavior during and immediately preceding the filing date will be closely examined. If it is obvious that you transferred any property or paid any money to specific creditors in favor of others, the trustee is permitted to re-collect this property and/or money so that it may be evenly distributed among all of your creditors.

A bankruptcy trustee is not working for you or against you, per se. A good way to look at it is that the trustee will ensure that your bankruptcy petition and paperwork are all flawless, which can only aid in making sure that your debts will be discharged and that your bankruptcy petition will not be dismissed.

Image Credit: Fried Dough (flickr)

11 Responses to Is My Bankruptcy Trustee Working For Me or Against Me?

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