Are Student Loans Classified as Marital Debt? | McCarthy Law
May 3, 2021

Are Student Loans Classified as Marital Debt?

It may seem odd to think about marital debt and student loans in the same context. After all, you might think that by the time a couple is considering getting a divorce, they would probably be free from student loan debt. However, that is not the case.  Today, 45 million Americans have active student loan debt that often lingers for decades after they finish school. Surprisingly, there are millions of Americans in their 40s, 50s, and 60s that are still struggling to pay off their student loan debt. These numbers are only expected to increase as millennials and younger generations—who have taken out more loans than ever before—continue to age.

Divorce in and of itself is a difficult situation no couple wants to go through. Having debt in a marriage creates an added complication to an already challenging process. Figuring out which person owes what and how to divide your assets can get messy fast—especially without good legal counsel to help you navigate the process. If you’re going through a divorce, you may be wondering if you and your partner’s student loan debt falls under the umbrella of marital debt. While there isn’t a simple yes or no answer regarding how student loan debt can factor into divorce debt, there are certain laws that can help you understand what to expect.

If you are going through a divorce and are struggling to figure out how your student loans are at play, it’s in your best interest to contact a skilled student loan lawyer. Here is some helpful information on student loans and divorce debt.

Are Student Loans Classified as Marital Debt?

In most cases, any debt that is accrued in a marriage is considered shared by the two partners. Usually, during a divorce settlement, a couple’s assets and liabilities are divided equally.  However, this can be a tricky thing to navigate when it comes to student loans, as most of the time, they are debts that are brought into a marriage. Are student loans classified as marital debt? Most of the time the answer is yes. However, there are a lot of factors that can change or complicate that answer.

A Lot Will Depend on Your State’s Laws

The way assets and debts are divided during divorce hinges on state laws. While special circumstances definitely happen, most of the rules around how communal property, assets, and debts will be allocated are fairly straightforward.

In states with community property laws, both persons in a marriage have equal ownership of all assets and debts that they owned during their marriage. This includes assets and debts that were incurred during the marriage, as well as any that were brought in. However, if the couple signed a prenuptial agreement, this rule may not apply.

Some states have equitable property policies, meaning the division process won’t necessarily be 50-50. In these states, each person can make their case during divorce proceedings as to why they should own less debt or more assets than their partner.

Most states are equitable property states, as it is generally considered the fairest way to address the financial aspect of a divorce. In these states, the judge may order a couple to divide the debt equitably rather than equally. The judge may order one party to use separate property to address a debt to make the settlement fair to both parties.

The Difference Between Debt Incurred Before and After a Marriage

Legally, student loan debt that is brought into a marriage belongs to the spouse with the loans. That being said, it may still be considered part of the divorce settlement if one spouse is much more financially secure than the other.

Similarly, student loan debt that is incurred during a marriage is usually considered a joint responsibility by both partners. This means that both persons in a marriage are equally responsible for the repayment of the loan. Although, this precedent can be complicated by other factors.

Paying Off Debt Before Getting a Divorce

If you can, paying off debts before a divorce is always the best option. When debts are out of the picture, it can make the divorce process less complicated and taxing. While this is the ideal scenario, it simply isn’t a reality for most couples. If this is the case for you, it is best to work with a seasoned attorney who can help you determine who is legally responsible for the debt and ensure you aren’t left with an overwhelming financial responsibility

Contact a Skilled Arizona Student Loan Lawyer

If you are going through a divorce and are worried about accumulating your partner’s student loan debt or paying off your loans on your own, it’s essential to seek legal counsel from a skilled student loan lawyer.

At McCarthy Law, our attorneys are dedicated to helping students pay off their student loans. Under our student loan debt settlement program, our licensed attorneys negotiate with lenders to fight for our clients to pay only a fraction of their original loan balance. To schedule a consultation with one of our skilled student loan settlement attorneys, call (855) 976-5777 or fill out our online contact form.

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