You already know that you and your former spouse must divide all shared assets during divorce. However, couples must also decide how to split any shared debt, which often includes student loan debt.
Student loans can incur hundreds of thousands of dollars of debt, so it stands to reason that couples have concerns about how to handle this issue during divorce. While financial situations vary greatly from marriage to marriage, here are a few things to consider when attempting to split student loan debt.
Which state you live in
Equitable distribution states typically look at each individual divorce situation to determine how to split shared debt. In community property states, courts divide shared assets and debt equally between each spouse. While California is a community property state, it typically considers student loan debt as separate property. However, there are some exceptions where both members of a marriage may have responsibility for the debt.
Uses of the loan money
Some people use their entire student loans to pay for costs related to their higher education. This can include expenses for tuition, books, meals, and other academic costs. Other people may use a portion of their student loans to cover living expenses. They may buy groceries for the home, pay rent or mortgage, or use the money for vehicle repairs. In this case, the non-student spouse may have some accountability for the loans.
The role of your spouse
College students often receive assistance from their spouses as they progress through school. Perhaps the non-student spouse worked full time and prepared all the meals for their spouse. Or maybe they sacrificed opportunities to ensure their spouse could receive an education. A court will look at these factors to determine whether the non-student spouse already “paid their dues” with regard to the loan money.