Are student loans dischargeable in bankruptcy?
Can the Chapter 13 trustee dismiss my case if I've missed a couple of payments?
Can the bank take my van after I file for Chapter 13 bankruptcy?

I've got $60,000 left in student loans, and I've been repaying them for ten years already. If I file for bankruptcy, will this debt be wiped out?

The rules for discharging student loans in bankruptcy have gotten tougher over the years. Currently, student loans are dischargeable only if you can prove to the court that repaying them would cause you undue hardship, which is a pretty tough standard to meet. And to make this showing, you'll have to file a separate action in your bankruptcy case.

A bankruptcy court will discharge a student loan for undue hardship only if it believes you'll never be able to pay the loan back. For example, if you have a permanent disability and no future ability to work, and you have made reasonable efforts to pay off as much of the loan as you can by using the various non-bankruptcy options available, the court might find that paying back the loan is more than should be asked of you.

If you file for Chapter 13 bankruptcy, you can include your student loans in the repayment plan, and try to make a dent in them over the life of your plan. However, you will still owe whatever student loan debt remains when you complete your plan, unless you can convince the court that it would be an undue burden. Be warned, however, that bankruptcy courts are typically very reluctant to discharge student loans.

I've been in bankruptcy status for well over two years. I recently fell behind on my payments and my trustee has petitioned for a dismissal. What can I expect if I go to court?

Once you get through the courthouse doors, the trustee will likely argue that your plan is no longer feasible -- that you cannot make the payments and therefore your creditors aren't getting paid and protected through bankruptcy.

Your best shot is to remember that old scout creed about being prepared. You'll have to show the court that you can get back on track with your plan, or propose an amended plan that still pays out enough to your creditors to make payments feasible.

If the court agrees with the trustee and dismisses your case, you'll owe your creditors the current balance, plus the interest that stopped accruing while you were in bankruptcy.

I filed a Chapter 13 bankruptcy and have already started paying the court. I sent a payment to the bank for a note owed, but the check was returned. They then came and picked up the van. My work material was in the van along with personal items -- and we have not yet been notified as to where they are. What legal recourse do we have against the bank?

When you're trying to get back on your feet, it seems especially unfair to have the rug tugged.

If payment to the bank was spelled out in your plan -- either outside of bankruptcy or within -- then the bank's action violates a court order, the confirmed plan. Sadly, your recourse is to invoke the slow grinding wheels of justice and sue the bank within your bankruptcy case.