A Chapter 13 trustee in California is an official appointed by the U.S. Trustee Program who reviews your repayment plan, runs the meeting of creditors, collects your monthly plan payment and distributes it to creditors for the life of the case. The trustee is not your lawyer and not the judge, but the trustee's objections can decide whether your plan is confirmed.
Who the Chapter 13 trustee in California is
Each federal bankruptcy district has one or more "standing" Chapter 13 trustees who handle every Chapter 13 case assigned to their division. Homeowners and workers in Pleasanton, Dublin, Livermore and the rest of Alameda and Contra Costa Counties file in the Northern District of California, so their case goes to the standing trustee who serves that part of the district. The U.S. Trustee Program, a branch of the Department of Justice, appoints and supervises these standing trustees.
Three things the trustee is not:
- Not your advocate. The trustee owes duties to the case and the creditors as a group. Your attorney is the one who speaks for you.
- Not a creditor. The trustee does not want your money for itself; it passes payments through to creditors under the plan.
- Not the decision-maker. The bankruptcy judge confirms or denies the plan. The trustee recommends, objects and reports.
If a trustee has already raised concerns in your case, or you are deciding whether to file at all, call (415) 754-0115 to book a free consultation, or send your details online, so an attorney can read the actual objection or plan with you.
How your plan payments flow, month by month
Many people are surprised that payments start before the plan is approved. Under the Bankruptcy Code, the first plan payment is generally due within 30 days of filing, and the trustee holds those funds until the judge rules on confirmation.
- You pay the trustee. Payments are usually made through the trustee's approved electronic or mail-in system, or through a wage order that has your employer send part of each paycheck directly.
- The trustee holds funds until confirmation. If the plan is confirmed, distributions begin. If the case is dismissed before confirmation, the rules on returning funds depend on the circumstances.
- The trustee pays creditors in plan order. Administrative items, secured claims such as mortgage or car arrears, priority debts such as recent taxes, and then general unsecured creditors receive their share as the confirmed plan dictates.
- The trustee tracks every payment. Missing payments is the most common reason a trustee files a motion to dismiss a case.
Your ongoing regular mortgage payment may be paid directly to the lender or through the trustee, depending on the plan and local practice. For a deeper look at how those numbers are built, read our guide to the Chapter 13 repayment plan.
Documents the trustee will ask for
The trustee's first job is to verify that your petition is accurate. Expect to provide, through your attorney and on a deadline before the meeting of creditors:
- Your most recent federal income tax return (and often state returns).
- Pay stubs or other proof of income covering the months before filing.
- Bank statements for every account, personal and business.
- Proof of identity and Social Security number, shown at the meeting.
- For self-employed debtors, profit and loss statements and business questionnaires.
- Mortgage statements, proof of insurance on your home and vehicles, and property valuations.
- A certification that you are current on any domestic support obligations.
During the plan, many trustees also require copies of each year's tax returns and may ask that tax refunds above certain amounts be paid into the plan.
The meeting of creditors and the confirmation hearing
At the 341 meeting
The trustee conducts the meeting of creditors, which many districts now hold by video or phone. You answer questions under oath about your income, expenses, property and the plan. Creditors may attend, though often none do. Our article on what happens at the 341 meeting explains the format.
At confirmation
Afterward, the trustee tells the court whether it supports the plan. If the trustee is satisfied, confirmation can be straightforward. If not, the trustee files an objection.
How an attorney handles trustee objections
Trustee objections are routine and usually fixable. The most common grounds are:
Feasibility
The trustee doubts your budget can support the payment. The response may be updated income evidence, a revised budget, or a modified plan.
Disposable income
The trustee believes more income should go to unsecured creditors, often because of an expense on the means test or budget.
Common flash points
Voluntary retirement contributions, high vehicle expenses, support paid to adult relatives and irregular bonuses are frequent subjects of disagreement.
Liquidation value
The trustee argues that creditors would receive more in a Chapter 7 case because of non-exempt equity. Valuation evidence or a different payment structure may resolve it.
Missing documents or unfiled returns
These are the simplest objections to cure, provided the paperwork is supplied quickly.
At The Somal Law Firm, Bob Somal handles this back-and-forth as part of the firm's Chapter 13 bankruptcy representation, negotiating with the trustee's office, amending the plan where needed and appearing at confirmation.
Frequently asked questions
Can I contact the trustee directly?
You can, but if you have an attorney, questions about the plan or objections normally go through counsel. Routine payment questions are often handled through the trustee's online portal.
What if I miss a plan payment?
Tell your attorney immediately. Depending on the reason, options can include catching up, a plan modification, or a temporary change. Ignoring it tends to lead to a motion to dismiss.
Does the trustee review my finances after confirmation?
Yes. The trustee monitors payments, may request annual tax returns, and can seek a plan modification if your income rises substantially.
Does the trustee sell my property in Chapter 13?
Generally no. Unlike a Chapter 7 trustee, the Chapter 13 trustee administers payments rather than liquidating assets, as long as the plan pays what the law requires.
Working with the trustee goes far more smoothly when your paperwork is right from day one. To talk through a new filing or a trustee objection in an existing case, call (415) 754-0115 or send your details through our contact page, and Bob Somal will review where your case stands and what the next step looks like.
Attorney Advertising. This article is general legal information for Bay Area residents, not legal advice, and does not create an attorney–client relationship. Every situation is different — please consult a licensed attorney about your specific circumstances.