In a Divorce, Who is Responsible for Student Loans?
In a world where obtaining both student loans and divorce is easy, The Wall Street Journal’s Charlie Wells asks the important question: In a divorce, who is responsible for the education debt?
For many young couples today, marriage means more than loving, honoring and cherishing each other—it also means taking on a spouse’s student loans. And not only does educational debt make life together tougher for some, it can lead to surprises for those who end up divorcing.
While no generation is immune to the complications surrounding debt and divorce, the current one may be especially vulnerable: College students who took out loans and earned bachelor’s degrees in 2012 graduated with an average $29,400 in educational debt, according to the Institute for College Access and Success, and those earning advanced degrees were typically on the hook for even more. Multiply that by two, and student loans could outlast many a marriage.
Legal experts say one of the most common misconceptions about dividing debt in a divorce is the belief that educational debt incurred before a marriage always becomes shared, marital debt once a couple gets hitched.
New York divorce attorney Cari Rincker says her mother once quipped that she couldn’t wait for Ms. Rincker to “get married because half of [her] student debt will be his.”
Ms. Rincker, who is single, had to correct her mother: Generally, educational debt incurred before a marriage is considered separate property and barring some predetermined contractual agreement, it stays that way after a divorce. “My law-school-loan debt is forever mine,” Ms. Rincker says. “No spouse will ever be liable” for it.
That can come as a rude awakening for those used to getting help with loan payments.
Such was the case when Devon Montgomery, a program manager for the Bryn Mawr College Alumnae Association in Pennsylvania, split from her husband of two years. The 29-year-old says she had racked up big student loans from various schools, and it was a challenge dealing with all of that debt by herself after her divorce.
Who Is Responsible for the Student Loans After Divorce? (The Wall Street Journal)
Comments
As I have cautioned my sons, debt on both parties is an impediment to large purchases. For example, a married couple who are looking to buy a house may find their available housing price constrained due to large student loans. That’s why both should be concerned about student debt.
However, pre-marital debt will remain the sole provenance of the one who incurred it. That’s pretty much black letter law. I do have a daughter that graduated college with a good amount of debt. But because she’s a teacher, she was able to get it discharged quickly. I told her for the type of guys she dates, that is a huge plus.
She told me later that a couple of the guys that she had dated were really relieved when they talked about school loans. And impressed that she had paid them off so quickly.