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Til debt do us part: divorce and student loan debt

In recent months and years, much attention has been paid to the growing number of Americans who are struggling to repay student loan debt. Recent economic difficulties coupled with the rising costs of higher education, have left millions of Americans with tens of thousands of dollars in student loan debt. As these men and women marry, questions related to who is responsible for paying student loan debt must be answered, particularly in cases where an individual subsequently goes through a divorce.

When a couple makes the decision to marry, both individuals pledge to share their lives with one another. For a growing number of adults in their twenties and thirties, student loan debt accompanies this pledge. While married, a couple may use combined and shared assets to pay off students loans. However, if the couple subsequently divorces, the responsibility to repay student loans accrued prior to a typically marriage reverts back to the original party.

In cases where an individual accrued student loan debt while married, other factors may be taken into consideration when determining who must repay such debt. For example, a judge may take into account the incomes of both individuals. If the spouse who didn't take out the loan makes four times as much as the spouse who took out the loan, much like alimony, a judge may decree that the wealthier spouse pay a portion of the remaining student loan debt.

In other cases, student loan debt may be viewed as shared marital debt and therefore, much like credit card debt, split equally. In other cases a judge may opt to compensate the spouse who supported his or her spouse’s educational aspirations. If this is the case, a judge will not only take monetary support into account, but also other things the spouse was forced to sacrifice while the husband or wife pursued a degree.

Prior to marrying, couples would be wise to discuss not only their assets, but also their debts. Financial obligations related to debt are a major stressor in a marriage and, when it comes to student loans, may continue to be even after a couple divorces.

Source: The Wall Street Journal, "Who Is Responsible for the Student Loans After Divorce?," Charlie Wells, April 13, 2014