Thanks for Paying My Student Loans, I Want a Divorce

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Sometimes great sacrifices are made in the name of love, but as some relationships grow apart and divorce comes into the picture, things that were once lovingly offered can transform into incredibly painful obligations and losses. Chances are that you might have made some of those great sacrifices for love. One thing that ends up hurting many people is the fact that they helped pay off their spouse’s student loans before their spouse decided to end the relationship, thus ending up empty-handed. In some cases, the spouse becomes particularly selfish and sets out to take whatever they can. In this article, we address concerns regarding student loans and divorce, because this particular type of debt is handled in a variety of ways in court.

Four Common Scenarios Involving Divorce and Student Loans

Scenario 1: Student loan was incurred before marriage

State and local laws can vary, but if the loan was made in just one person’s name and brought into the marriage, then the burden to pay back the loan tends to remain squarely on the shoulders of the person whose name is on the loan. This is particularly true for federal loans, but private loans can be even more difficult to sort through if there was a cosigner. Even if some of the money was used to help support the marriage later down the road, it will still be up to the original borrower to pay the debt on their own.  

It is also true, however, that the judge could potentially order responsibility to both parties, but this is less common and it depends on if there was a prenuptial or postnuptial agreement and/or actions of the parties throughout the marriage. Keep in mind that the lender is really ultimately only concerned with the person whose name is on the loan–but a divorce court could still assign responsibility to either or both parties.

Scenario 2: Student loan incurred during marriage

Things can get a bit more complicated if the loan was taken out after getting married. Furthermore, if the spouse co-signed, this automatically involves them in whatever consequences could happen, even after divorce. Their credit could get hammered if the other person ended up defaulting due to nonpayment.

Unfortunately, divorce doesn’t mean anything to the lender if the loan was filed jointly. They still just want their money, and they want it on time. The fact is, the student loan is now considered marital debt, and it is lumped in with any other debt that was incurred throughout the marriage. Your state divorce laws and individual circumstances will ultimately decide how this is divided, and obviously, the most capable person to help you sort this out will be your lawyer. If the divorce took place rather quickly after graduation, it is very likely that the debt will go to the person that borrowed it for school, particularly if they have the means to afford it.  

Scenario 3: If the loan was paid off by the other spouse that wasn’t the borrower

It is an honorable, selfless, and thoughtful thing for one spouse to do for the love of their life, but what if things don’t come up roses after all? What if after doing this, the spouse turns and files for divorce?   You may be able to require them to pay you back if they have the money. Have your lawyer help you determine if you are able to make a successful claim to get reimbursed, and if it is possible, they can help you get back what is yours.

Scenario 4: If the loan was paid off by the other spouse, but it was ages ago

Some marriages really seem to last, until it is the last straw or until someone does something completely unexpected. There may have been a time in the past that involved a bit of financial support of one or the other. Unfortunately, if a spouse paid off the loan for their partner a long time ago, then it is typically not possible to get reimbursed. This may be especially true if the spouse who was in school was also doing the bulk of the household work and/or childrearing.

So where is the cut off when it comes to eligibility for reimbursement?  If it has been a few decades since it was paid off, chances are that too much time has passed. If you are unsure about if you will be able to get your spouse to pay you back, your lawyer can discuss this with you.

*Keep in Mind: Every state has its own laws regarding divorce and the separating of assets and debts. For example, Texas has an overarching rule on dividing community property, which includes debt. The division is based on a “ Just and Right” doctrine. This does not necessarily mean equal, but it still aims to be fair. There are some states that also work this way, but there are others that are strictly 50/50 in how they split things.

Factors Regarding the Student Loans

There are a few things that will be examined when it comes time to determine a fair split between them.  

  • Who is the loan for?
  • How much of the money was used towards the school?
  • Was a degree earned?  Which one? (This can actually be considered marital property in some states)
  • How much do you earn versus your spouse?
  • How much of the money ended up being used to help support the whole family in addition to school costs?

Finding the Right Representation for You

Going through the legal process is quite a feat, and when it is a divorce case it can be even more difficult. Truly, the emotional struggle is reason enough to have an attorney help you to make sure that you cross all t’s and dot all i’s in order to ensure that you come out of this in the best possible way.

Brad Tilton is a qualified divorce lawyer serving the greater Houston, TX area.   

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