Chapter 7 & 11 Bankruptcy Lawyers - Nick Davis Law

In a Chapter 7 case, the trustee reviews your financial documents and assesses which of your assets are non-exempt based on Texas or federal bankruptcy exemption laws. Non-exempt assets, such as certain investments, secondary homes, or luxury items, may be subject to liquidation to repay creditors. The trustee conducts a thorough analysis of your assets and compares them against the exemption limits. It’s crucial to accurately disclose all assets and consult with your attorney to ensure maximum protection of your property under Texas’s generous exemption laws, such as the unlimited homestead exemption.

Yes, bankruptcy trustees have the authority to investigate transactions made in the months or years before filing for bankruptcy. If the trustee suspects fraudulent transfers or preferential payments to certain creditors, they can seek to reverse these transactions to recover funds for the bankruptcy estate. In Texas, trustees typically review transfers made within two years before filing, but this period can be extended in some cases. It’s essential to discuss any large transactions with your attorney before filing to avoid legal complications and trustee challenges.

If you disagree with the trustee’s valuation of your assets, you can challenge their assessment by providing evidence that supports a different valuation. This may involve obtaining professional appraisals or showing recent market trends that affect the value of real estate, vehicles, or personal property. The court will consider both sides before making a final determination. Your attorney can assist by presenting a compelling case to protect your assets and ensure that they are not undervalued, which could lead to liquidation.

In Texas, where oil, gas, and mineral rights are common, the trustee evaluates these assets to determine their value and whether they are exempt. Depending on the structure of your ownership (such as royalties or lease agreements), these rights may be treated as either ongoing income or valuable property. Trustees will review whether the rights generate regular income or are considered non-exempt property. You may need to work with your attorney to strategically protect these assets, especially if they are essential to your financial recovery post-bankruptcy.

Yes, in a Chapter 11 case, the trustee can object to your reorganization plan if they believe it does not fairly represent creditor interests or if it’s not feasible. The trustee’s role is to ensure that your plan provides for the maximum repayment possible and complies with bankruptcy laws. Objections may focus on issues like undervalued assets, unrealistic income projections, or improper classifications of creditors. To avoid objections, it’s critical to work with your attorney to draft a strong, realistic plan that addresses the concerns of both the trustee and creditors.

For businesses filing Chapter 7 in Texas, the trustee’s role is to liquidate the company’s non-exempt assets and distribute the proceeds to creditors. The trustee will evaluate business equipment, inventory, real estate, and intellectual property to determine what can be sold. Additionally, the trustee will review financial records to identify any preferential payments or fraudulent transfers. It’s important for business owners to cooperate fully with the trustee to avoid delays and ensure the process proceeds smoothly. A business bankruptcy attorney can help protect personal assets that may be tied to the business through personal guarantees or other obligations.

In most cases, if you have claimed the Texas homestead exemption, your home is protected from being sold in bankruptcy, as long as it meets the size and acreage requirements (up to 10 acres in urban areas or 100-200 acres in rural areas). However, if your home exceeds the exemption limits or you have significant non-exempt equity, the trustee may seek to liquidate the portion of your home’s value that is not protected. Working closely with your attorney can ensure that your homestead exemption is correctly applied and that your primary residence remains safe from liquidation.

Yes, after the 341 meeting of creditors, the trustee may request additional documentation if they need further clarification about your financial situation, assets, or recent transactions. This could include tax returns, bank statements, pay stubs, or proof of ownership for certain assets. It’s important to respond promptly and provide accurate information, as failure to cooperate with the trustee’s requests can delay your case or lead to adverse rulings. Your attorney will help ensure that all documentation is in order and that the trustee receives the necessary information.

If a trustee discovers that you failed to disclose assets in your bankruptcy case, it can have serious consequences. The trustee may take steps to recover and liquidate the undisclosed assets, and you could lose any exemptions that would have protected them. Additionally, hiding assets can result in the denial of your bankruptcy discharge, fines, or even criminal charges for bankruptcy fraud. It’s critical to disclose all assets fully and accurately when filing for bankruptcy. Your attorney can help ensure your financial disclosure is complete and avoid the risk of penalties or legal action.

Yes, trustees can object to the discharge of specific debts if they believe the debts were incurred through fraudulent means, such as providing false information on credit applications or engaging in fraudulent transactions. Creditors may also object to the discharge of debts if they believe they were harmed by your actions. If a trustee or creditor challenges the discharge of a debt, an adversary proceeding is initiated to resolve the issue in court. Your attorney can defend you against these claims to help protect your right to discharge eligible debts.

In a Texas Chapter 7 bankruptcy, secured debts, such as mortgages and car loans, are handled by either reaffirming the debt, redeeming the property, or surrendering the collateral to the creditor. The trustee will not interfere with secured debts if you choose to reaffirm or redeem the property, as these debts are typically not discharged in Chapter 7. However, if you decide to surrender the collateral (e.g., return the car or home to the lender), the trustee may oversee the process to ensure it’s handled properly. It’s important to work with your attorney to decide the best course of action regarding secured debts.

In a Chapter 13 bankruptcy, the trustee’s role is to oversee the implementation of your repayment plan. The trustee reviews your proposed plan, ensuring it meets legal requirements and fairly compensates creditors. Once approved, the trustee collects your monthly payments and distributes the funds to creditors based on the terms of the plan. The trustee will also monitor your financial situation throughout the bankruptcy, making sure you stay current on payments. Your attorney will work with the trustee to ensure your plan stays on track and any issues are promptly addressed.

Yes, a trustee can abandon assets if they determine that the asset is burdensome to the bankruptcy estate or has little value to creditors. For example, if the cost of selling the asset exceeds its potential sale value, the trustee may abandon it, allowing you to keep it without liquidation. This can be beneficial for low-value assets such as older vehicles or personal property. Your attorney can help identify assets that may be eligible for abandonment and present a case to the trustee, allowing you to retain certain property that might otherwise be liquidated.

In a Texas bankruptcy, tax refunds that are owed to you at the time of filing are generally considered part of the bankruptcy estate and may be used to pay creditors. The trustee will evaluate the amount of the refund and determine whether it is exempt under Texas law. If it is not exempt, the trustee may seize the refund to distribute to creditors. However, any tax refunds earned after the bankruptcy filing are typically not included in the estate. Your attorney can help you understand how to protect your tax refunds and manage your finances to avoid losing them to the bankruptcy estate.