Bankruptcy Trustee

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DEFINITION of 'Bankruptcy Trustee'

A person appointed by the United States Trustee, an officer of the Department of Justice, to represent the debtor's estate in a bankruptcy proceeding.

Although a bankruptcy judge has the ultimate authority on the distribution of assets, the trustee is charged with evaluating and making recommendations about various debtor demands in accordance with the U.S. Bankruptcy Code.

INVESTOPEDIA EXPLAINS 'Bankruptcy Trustee'

The responsibilities of the trustee are different in a Chapter 7 bankruptcy proceeding (which is essentially a liquidation) than in a Chapter 11 proceeding, wherein the debtor hopes to emerge from the bankruptcy as a going concern. In a Chapter 7 proceeding, the trustee will manage the asset sales and then distribute the proceeds to creditors.

A Chapter 13 proceeding applies to individuals who hope to keep some of their assets in return for repaying certain debts.

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RELATED FAQS
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  3. What property / belongings can I keep after filing bankruptcy?

    If you file bankruptcy, particularly a Chapter 7 bankruptcy, property that is considered part of your estate is subject to ... Read Full Answer >>
  4. How do I get information about my bankruptcy case?

    The vast majority of individuals file for bankruptcy using the services of a bankruptcy professional. A copy of the petition ... Read Full Answer >>
  5. What is the history behind today's bankruptcy laws?

    Julius Caesar was emperor of Rome for a scant five months, but in that short time he changed the course of financial history. ... Read Full Answer >>
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