The trustee is required to determine whether the debtor meets all of the chapter 7 criteria for a discharge and whether the debtor is entitled to a discharge.

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The trustee must also determine if the debtor has any unexempt and/or valuable assets which he may sell. Although very atypical, in the event of the sale of the debtor’s property, the trustee must properly administer the proceeds of the sale, and disburse the funds, pursuant to the bankruptcy code. The ability of the trustee to sell property is based on exemptions, which is explained, in detail, on another website page.

The trustee reviews the following documents and information in determining if the debtor has satisfied all of the chapter 7  criteria:

• review the debtor’s entire bankruptcy petition, which includes the debtor’s assets, income, expenses, debts, and various transactions;
• review the debtor’s tax returns, bank statements, pay stubs, and home valuation;
• review any additional documents and information that he deems relevant.
• investigate the financial affairs of the debtor.

The trustee’s filing of a “Notice of Abandonment” of the debtor’s real property is positive for the debtor. This means that the trustee is abandoning his right in the debtor’s house, which results in permitting the debtor(s) to keep the house.

The trustee must also file a statement with the court indicating that he may not sell any assets, or that he may sell an asset. Although very unusual, if he can sell an asset, the information regarding the asset must be filed with the court. In this scenario, the trustee administers the sale.

Furthermore, the trustee must file a statement with the court indicating whether the debtor passed or failed the “Statement of Current Monthly Income Analysis”/”Means Test”. The “Means Test” analysis is explained in a separate portion of the website.

The trustee also has an obligation to oppose a discharge of the debtor, in the event that the trustee believes the debtor has sufficient monthly disposable income to pay a monthly amount to his creditors.

The trustee may also oppose a discharge based on any violation of the bankruptcy code, which includes, but is not limited, to the debtor’s following acts:

• filing a petition in bad faith, or fraud
• incurring debt by fraud
• intent to hinder or delay the process
• failure to cooperate with the trustee’s directions
• conceal or destroy property
• intentionally provide false information or testimony
• or otherwise fail to comply with the bankruptcy requirements.

A trustee may operate the debtor’s business, if the result would benefit the creditors of the bankruptcy estate.

Also, the trustee may file the appropriate documents with the court requesting to revoke a discharge, when necessary.

Contacting a Chapter 7 Bankruptcy Attorney in New Jersey

If you are dealing with a bankruptcy case, you should consult with a lawyer. A skilled Chapter 7 bankruptcy attorney will be able to help you navigate the complex bankruptcy proceedings and ensure that you are compliant with the bankruptcy laws. For a free consultation, fill out our online form or call us at 866.503.5655.