trustee fee

[howdidithappen]

how are trustee fees determined? Is there a formula?

[MSbklawyer]

how are trustee fees determined? Is there a formula?

http://www.justice.gov/ust/eo/bapcpa/20090315/bci_data/ch13_exp_mult.htm#MS

[howdidithappen]

Thanks for the information but I would like information regarding trustee fees for Chapter 7. Also, the percentage is applied to what number? The amount of debt? The amount of assets? What exactly?

[justbroke]

I think you're confused. There is no "trustee fee" in a Chapter 7. The "panel" Trustee, who liquidates the Estate, makes $60 which comes from the $299 filing fee. In addition, the "panel" Trustee can make money via a "commission" if and when the find items to liquidate and so liquidate them.

Technically, for any non-exempt asset that they find an liquidate, they get 25% of the first $5,000, then 10% of the next $45,000 (to $50K), then 5% of the next $950,000 (to $1MM), and then 3% thereafter.

This commission comes from the sale and disposition of the assets.

Why are you asking? No one ever worries about this.

[bigtim6656]

Sounds like a good job to have in say ohh miami or LA.

I think you're confused. There is no "trustee fee" in a Chapter 7. The "panel" Trustee, who liquidates the Estate, makes $60 which comes from the $299 filing fee. In addition, the "panel" Trustee can make money via a "commission" if and when the find items to liquidate and so liquidate them.

Technically, for any non-exempt asset that they find an liquidate, they get 25% of the first $5,000, then 10% of the next $45,000 (to $50K), then 5% of the next $950,000 (to $1MM), and then 3% thereafter.

This commission comes from the sale and disposition of the assets.

Why are you asking? No one ever worries about this.

[howdidithappen]

just trying to understand what someone told me - they told me the trustee would get around $28K. I'm new to all this and have alot to learn in a very short amount of time.... Thanks

[justbroke]

just trying to understand what someone told me - they told me the trustee would get around $28K. I'm new to all this and have alot to learn in a very short amount of time.... Thanks

For the Trustee to earn $28K on a single case, the Trustee would basically need to find about $500,000 of non-exempt assets to administer. Unless the person who told you this was an attorney, who has seen your particular case and assessed your particular assets... don't listen to them.

[tay666]

For the Trustee to earn $28K on a single case, the Trustee would basically need to find about $500,000 of non-exempt assets to administer. Unless the person who told you this was an attorney, who has seen your particular case and assessed your particular assets... don't listen to them.

That, or the 28K is what the trustee will take to distribute to creditors.
Which they would only get about $3550 for themselves.

[howdidithappen]

OK so let me get this straight - if my home is sold (and I was told a realtor will be appointed by the Court - commissions here are 6%), the realtor will get a commission as will the trustee.
Also, who exactly are trustees? Are they bankruptcy lawyers appointed by the Court? If so, how long are their terms? How are they selected?

[justbroke]

OK so let me get this straight - if my home is sold (and I was told a realtor will be appointed by the Court - commissions here are 6%), the realtor will get a commission as will the trustee.

Yes, the Realtor would get the standard commission unless the Trustee negotiates a lower amount.

Also, who exactly are trustees? Are they bankruptcy lawyers appointed by the Court? If so, how long are their terms? How are they selected?

Yes, exactly. They are "approved" bankruptcy attorneys that are usually already admitted to practice before the US Bankruptcy Court. Many of them are also practicing bankruptcy attorneys in the consumer and/or business bankruptcy areas. They basically sign up for this and go through an approval process through the Office of the United States Trustee (OUST) for that District/Area. I don't know if they have a "term".

[tay666]

OK so let me get this straight - if my home is sold (and I was told a realtor will be appointed by the Court - commissions here are 6%), the realtor will get a commission as will the trustee.

Yes.
But the trustee's commision would be based on the amount left over after first paying the realtor, then the bank holding the note on the house, then paying you any homestead exemption you are owed.
That is the amount the trustee would have available to distribute to creditors.

Example.
Your house sells for $100,000.
Say you still owed $60,000 and your state gives you a homestead exemption of $20,000.

The realtor would get $6,000
The bank would get $60,000
You would get $20,000

That leaves the trustee $14,000 to distribute to the creditors.
The trustee would get $2150 of that.
Leaving $11.850 to distrubute to the creditors.