Seder & Chandler, LLP
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How do Massachusetts' divorcing couples split student loans?

Student loans have become a major financial burden for individuals across America, including those in Massachusetts. In fact, in 2012, bachelor degree earners averaged $29,400 in debt upon graduation. Many individuals considering divorce may be concerned about how this debt will be divided when a marriage is dissolved. Hopefully this post will help clear up some common misconceptions.

A lot of people think that student loan debt accumulated prior to a marriage becomes shared once a couple gets married. This is not the case. Typically, student loan debt incurred in an individual capacity and prior to a marriage is considered separate property and is therefore not subject to debt division in a divorce proceeding. A prenuptial or postnuptial agreement, however, can specify how pre-marriage, individually acquired educational debt will be divided in the event of divorce.

Student loans taken out during a marriage are handled differently. Sometimes during the divorce process loan repayments are divided according to which spouse has the best ability to pay. In other words, a high income ex-spouse may have to pay spousal support to help a lower income ex-spouse who incurred student loan debt. In some instances, an earned degree is treated as marital property, meaning its value may be subject to asset division during the divorce process. The degree earner may have to pay the other spouse for time he or she spent supporting the degree earner in his or her educational pursuits.

The division of marital property and debts can be extremely complicated. In order to ensure his or her best interests are protected, a divorcing party may want to seek help from a Worcester Divorce Lawyer. With an advocate by his or her side, a divorcing party can feel more at ease that a fair and favorable outcome may be reached.

Source: The Wall Street Journal, "Who Is Responsible for the Student Loans After Divorce?" Charlie Wells, April 13, 2014

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