Am I Obligated to Pay my Ex’s Student Loan Debt?

Usually, no. In most cases, individuals who took out student loans did so before they married, taking on the debt alone or co-signing with their parents for it. Because they obtained this debt before marriage, it is considered to be singly-held property.

But if you co-signed with your spouse when he or she took out a student loan after you were married, you could potentially be held responsible for it. There are certain circumstances under which the court may determine that you are liable for your former spouse’s student loan debt, such as the following:

  • If you co-signed for the loan.

  • If the loan was used to partially or fully pay for your shared living expenses, such as your housing, utilities, or food bills.

  • If the resulting degree altered your standard of living or moved you into a higher tax bracket by enabling your former spouse to get a higher-paying job than he or she had before earning the degree.

If your spouse has significant student loan debt and you fit one of the categories listed above, you could be required to contribute to it financially after your divorce. In New Jersey, divorcing couple’s property is divided according to the equitable distribution principle, which means that each partner receives a share of the couple’s marital property according to his or her contribution to the couple’s material and financial net worth and his or her needs following the divorce.

Turning a Singly-held Debt into a Marital Debt

There are also circumstances under which an individual may be required to continue paying for his or her former spouse’s student debt even if the debt was originally singly-held by the spouse who signed for it. An example of this type of scenario include cases where couples choose to refinance their debts after their marriage, consolidating their debts to take advantage of a lower interest rate. Another is when a couple specifies in their prenuptial agreement that their individually-held debts will become marital property. In either of these cases, a judge may rule that a divorced spouse must continue making payments to his or her former partner’s student debt.

Do not enter any type of legal agreement, including marriage, until you completely understand its financial ramifications. Discuss these ramifications with your attorney and your fiancé before drafting your prenuptial agreement to prevent financially trapping yourself later.

Divorce Attorneys in Wall, New Jersey

Today, thousands of Americans have significant amounts of student loan debt. Depending on when you signed for your student loan and how it affected your net worth during your marriage, your debt may be considered to be marital property. To learn more about this and other debt that may be divided during your divorce, contact The Law Office of Eric B. Hannum Esq., LLC. today at 732-370-9596. We proudly serve clients in Ocean, Monmouth, Middlesex, Mercer, and Burlington counties.

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