Dealing with student loans during a divorce

Debts taken on during the course of a marriage are generally considered part of the marital estate, and they are divided as part of a divorce just like assets are. This can lead to bitter disputes when the debts in question are student loans. Divorcing spouses may resent making payments on loans that helped their former husbands or wives to attend college, and in states with equitable distribution laws they may not have to. Connecticut is one of these states.

Some states have community property laws that require marital assets and debts to be divided equally, but the rules in Connecticut allow for unequal distribution if such an arrangement is more equitable. When deciding how to deal with student loans, judges in equitable distribution states will consider how much each of the spouses involved earns, whether or not the spouse who did not attend college supported the spouse who did and whether or not the spouse who attended college graduated with a degree. Judges will also study the loan documents to seen who signed them.

Spouses may be expected to pay student loans if they signed the paperwork or a degree was earned. This is because a degree earned during a marriage is considered a marital asset. Spouses who supported their husbands or wives when they were attending college or have moderate or low incomes may not be expected to make student loan payments.

Experienced family law attorneys may point out to their clients that banks are not bound by the terms of a divorce settlement , which means that they can pursue spouses who signed loan documents for payment regardless of how the debt involved was handled during property division negotiations. This is why attorneys may suggest that all jointly-held loans are either paid off or refinanced.