your options for getting out from under debt

The Cast Of Characters In A Chapter 7 Proceeding

When dealing with a Chapter 7 proceeding, it's wise to know who the folks are that you'll be dealing with and what their roles will be. Here are four names you'll hear in the cast of characters when you file for bankruptcy.


This is almost certainly you or an entity that you own. The debtor is the individual who owes money to other parties. When filing under Chapter 7 bankruptcy law, the debtor is asking the court to completely discharge whatever debts are listed in the petition.

If the court accepts the petition for relief, the debtor's non-essential assets will be sold. Proceeds from these sales will then be distributed to the creditors.

The Creditors

Anyone you legally owe money to is a creditor, and they have the right to demand that their concerns will be heard during a bankruptcy. Furthermore, the creditors will have the opportunity to ask the debtor questions under oath if they believe something is not right about the bankruptcy.

If the bankruptcy is approved, the creditors will most likely not be made whole on what they're owed. One exception is secured debt, things like car loans and mortgages. In those instances, the creditor can simply reclaim the property that collateralizes the loan. All unsecured debt, however, will be wiped out once the selling process is completed and funds are distributed.

Note that you must name all of your creditors in the petition. Unnamed creditors retain the right to continue pursuing the collection of debts.


One of the big surprises first-time filers notice is that they end up not dealing with a judge very much. Instead, the court will appoint a trustee.

You should be aware the trustee has a fiduciary responsibility to the creditors. That means they're obligated to try to recover as much money as possible by selling any assets the court hasn't prohibited from being sold. It's important when you petition for relief to list all items you wish to keep, otherwise the trustee will be able to sell anything the judge didn't specifically exclude.

A trustee is appointed to save the court time for bigger issues. The trustee is usually someone who has worked as an accountant or a bankruptcy lawyer, and they will implement the will of the court to the best of their ability.


With few exceptions, the judge simply signs off on things. The trustee will make recommendations, and those recommendations will be followed unless the debtor or a creditor objects. When objections occur, the judge is responsible for resolving them.