Bankruptcy Wizard
The Trustee's job was meant to be unforgiving, cold, and unrepentant. In some cases, the Trustee's will be a little nicer, but that is not their job! They can lose their job if they are too lenient. The thing is to be consistent in all cases, regardless of the underlying reason a person is in bankruptcy. Remember, that without going through bankruptcy, you are left to the wolves -- the creditors -- where there is really no humanity. The creditors would take everything if they could.
In the end, Bankruptcy is very emotional and can be extremely depressing for many. Any successful Trustee will keep emotion out of the equation. if not, they'll just be replaced by a more methodical and mechanical Trustee. After all, we will keep reminding everyone that it's a highly "technical" and "mechanical" process. Common-sense does factor in "some times", but it is not the norm! There are Trustees here in Florida that won't even allow you to purchase non-exempt items from them! They tell you to just go to the auction and bid on the items if you really want them!
As stated, the Trustees are given an incentive because they won't make ANY MONEY if they just take the $60 in every case! Trustees are practicing attorneys and have a staff and an office. Even with 1,000 cases assigned to them in one year, that's only $60K. Hardly enough to pay for staff and an office... let alone themselves. They receive a "commission" just like the real estate agent receives commission. It's on a declining scale and not 25% of everything. it's 25% of the first $5,000 and then 10% of the next $45K. Then it drops to 5% of anything over $50K to $1,000,000. It drops to 3% for anything over $1,000,000.
So, if they spend 20 hours trying to fighting with you over your assets, they just wasted at least $3,000 (20 hours x $150/hour in legal fees). If they can recover $5K in assets, they'll make $1,250 which will cover less than 8 hours of their "expense" trying to get the assets. Trustees typically go after assets that they know they'll be able to recover (liquidate) -- think low hanging fruit. (Okay, there are some cases where the asset is just too juicy to worry about costs, so they'll go after a home that has title or promissory note/mortgage issues!)
That's the real deal.
For what it's worth... the maximum amount a Chapter 7 "Panel" Trustee is only limited by what they "bill" (Application for Fees) to the Estate. The percentages listed above are "maximums" and need to be earned. A Chapter 7 "Panel" Trustee does not have the limit that is applied to the earnings of a Chapter 13 "Standing" Trustee. The Chapter 13 "Standing" Trustee can't make more than an executive level employee of the US Government which is around $132K if I'm not mistaken (give or take). The Chapter 7 "Panel" Trustee has to "earn" their money and if they work more hours (bill more hours) and incur more expenses than they can recover from the Estate... oh well! Smart Panel Trustees know when to hold them and know when to fold them.
In the end, Bankruptcy is very emotional and can be extremely depressing for many. Any successful Trustee will keep emotion out of the equation. if not, they'll just be replaced by a more methodical and mechanical Trustee. After all, we will keep reminding everyone that it's a highly "technical" and "mechanical" process. Common-sense does factor in "some times", but it is not the norm! There are Trustees here in Florida that won't even allow you to purchase non-exempt items from them! They tell you to just go to the auction and bid on the items if you really want them!
As stated, the Trustees are given an incentive because they won't make ANY MONEY if they just take the $60 in every case! Trustees are practicing attorneys and have a staff and an office. Even with 1,000 cases assigned to them in one year, that's only $60K. Hardly enough to pay for staff and an office... let alone themselves. They receive a "commission" just like the real estate agent receives commission. It's on a declining scale and not 25% of everything. it's 25% of the first $5,000 and then 10% of the next $45K. Then it drops to 5% of anything over $50K to $1,000,000. It drops to 3% for anything over $1,000,000.
So, if they spend 20 hours trying to fighting with you over your assets, they just wasted at least $3,000 (20 hours x $150/hour in legal fees). If they can recover $5K in assets, they'll make $1,250 which will cover less than 8 hours of their "expense" trying to get the assets. Trustees typically go after assets that they know they'll be able to recover (liquidate) -- think low hanging fruit. (Okay, there are some cases where the asset is just too juicy to worry about costs, so they'll go after a home that has title or promissory note/mortgage issues!)
That's the real deal.
For what it's worth... the maximum amount a Chapter 7 "Panel" Trustee is only limited by what they "bill" (Application for Fees) to the Estate. The percentages listed above are "maximums" and need to be earned. A Chapter 7 "Panel" Trustee does not have the limit that is applied to the earnings of a Chapter 13 "Standing" Trustee. The Chapter 13 "Standing" Trustee can't make more than an executive level employee of the US Government which is around $132K if I'm not mistaken (give or take). The Chapter 7 "Panel" Trustee has to "earn" their money and if they work more hours (bill more hours) and incur more expenses than they can recover from the Estate... oh well! Smart Panel Trustees know when to hold them and know when to fold them.
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