Dividing student loan debt in divorce

On Behalf of | Aug 17, 2021 | Property Division |

It’s not uncommon these days for people to still be paying off student loan debt well into their 40s and even beyond. Therefore, if you and your spouse both have student loan debt as you divorce, you’re far from alone. So how do you deal with it?

Generally, if you took out your student loan before you got married, that loan is yours alone to pay off. The same is true with your spouse’s student loan.

Why student loans after marriage are more complicated

What if you obtain a student loan after you were married? For example, maybe you went back to school to get a graduate degree. Typically, the division of those loans is more complicated because you may have used your spouse’s income to qualify. You may also have used the money they were earning while you were in school to make payments on the loan. However, maybe the profession you’ve pursued with that degree allowed you to purchase more expensive property and other assets than you might have otherwise. All of these things need to be considered.

Even if both your and your spouse’s student loans are strictly your own, that doesn’t guarantee that one of you might not get responsibility for part of the other one’s debt if a judge has to decide the matter. In an equitable distribution state like Colorado, the courts generally strive to divide assets and debts fairly – which doesn’t necessarily mean evenly.

Other factors a court may consider

If your spouse earns considerably more than you, for example, it’s possible that they could be assigned some of your debt in the divorce. However, if they can show that the bulk of the repayments on your student loan over the years came from the money they earned that was in a joint account (or their account), a judge may believe they’ve done more than their share to pay your debt, and you could end up with the balance of the loan. 

It’s typically best when couples can work out their division of assets and debts on their own, with the help of their attorneys. If you can’t agree on something, like how your student loan debt will be divided, the judge will have to decide based on the law and the case that each of you presents.