In Case of Divorce, Who Owns Your Student Loans?

In Case of Divorce, Who Owns Your Student Loans?

Students leave college with an average of $29,400 in student loans, which might motivate a lot of young adults to hurry up and get married—not just for love and companionship, but to have two incomes to throw at their debt.

And that’s all well and good … until a marriage goes sour.


Get started with a free financial assessment.

But it’s a common misconception that student loans taken on before a couple weds becomes shared marital debt after the nuptials, The Wall Street Journal reports. Rather, if a couple divorces, unless a written agreement states otherwise, the loans will stick with the person whose education they paid for.

This can have serious implications for new divorcees who are accustomed to having help from a spouse with making their monthly payments.

Once someone is responsible for student loans on her own once again, she may have to reallocate her debt, or switch to a repayment plan with smaller monthly payments over a longer period of time.

The situation gets even stickier when student loans are taken on after a couple is married. Typically, the debt will still remain the responsibility of the spouse who received the education, though this depends on the state laws.

In many states, divorce court judges can decide whether they’d like to take context into consideration when allocating the debt. For example, a judge may see that one spouse’s income will be significantly lower than the other’s after the divorce, and rule that the wealthier spouse has to help with payments.

In New York and a handful of other places, the professional degree itself can be considered marital property that must be divided equitably. This means that the spouse who received the degree may have to compensate the spouse that supported him while he was earning his degree. Support can include anything from preparing meals to rides to campus to delaying her own educational pursuits in order to support her partner. In some cases, judges have awarded more of the couple’s other property to supporter spouse because a professional degree is so valuable.

RELATED: Why I’m Getting a Prenup—and You Should Too

An easy way to avoid potential turmoil with student debt during a divorce? Discuss signing a prenup before you tie the knot.


Financial planning made simple.

Get your free financial assessment.

Related Tags

Get the latest in your inbox.

Subscription failed!

You're Now Subscribed!