When you are getting a divorce, you are forced to take stock of your life and all your debts and assets. Having an education is an undeniable asset in this economy but one that comes at a price. While a degree certainly adds to your earning power and potential, more often than not it will come with a burden of student loan debt that you cannot get away from.
You may be wondering how your or your spouse’s student loans will be divided in the divorce. If you both have equal student loan debt, the arraignment may be easy to work out. If the debt is more skewed, you may want to focus on dividing the total net value rather than each individual debt or asset. If you agree to pay for your student loan, you can ask your spouse to pay an equitable amount of debt on their own to balance things out. If your student loan debt was incurred prior to marriage, that amount of debt is yours and yours alone. This is generally considered separate debt.
Although your spouse may not be liable to pay this debt for you, if you are receiving spousal support, the support amount may reflect your monthly loan payment. Keep in mind that spousal support may not last as long as your student loan debt might, as it is often temporary, so in effect, this may only help you pay it off temporarily.
If your student loan debt was incurred during the course of the marriage, it is generally considered community or marital debt, meaning both parties are liable for paying it off. In this case, the spouse not holding the student loan in their name may take an equal share of the community debt to balance out the loan distribution. Complications may arise when your degree, earned during the marriage, will bring you significant earning power that your spouse will not benefit from.
To the extent that a spouse supports his or her spouse while they go to school, the benefits from the degree and the debts from the loan are both equally shared. Furthermore, if those loans were used in part for community purposes, for living expenses lets say, then both spouses benefited from the loans directly and this could affect division. Dividing student loan debt is a complex part of divorce and one that would be best handled by an experienced family law attorney. Speak to an attorney if you feel your student loans and/or degree may make property division or spousal support calculations difficult.
Are you in Los Angles County and have some questions about how to divide your debts and assets? Certified Family Law Specialist Steven Fernandez has experience with complex divorce issues regarding property division and high net-worth individuals and will work hard to make sure your financial interests are looked out for. Representing individuals in Los Angeles and surrounding areas, Steven Fernandez will listen to your case and, based on your needs, will take action to ensure a favorable outcome for you. Call our office at (310) 393-0236; email us at [email protected] or contact us through our online form today to schedule a free consultation.Related Posts: How Can a Divorce Affect My Credit? | Knowing Your Worth: What is Considered an Asset? | What is a Schedule of Assets and Debts? |