Who is liable for student loan debt in a divorce?

On Behalf of | Apr 9, 2020 | Divorce |

When a couple in Ohio gets a divorce, their marital assets are subject to equitable distribution. This means that, if a judge has to make an order as to how the couple should divide their property, the judge will do so in the way he or she thinks is most fair, rather than splitting everything 50-50. The equitable distribution rule would also apply to debt incurred jointly by married spouses.

If one spouse incurs debt prior to getting married, such as by taking out a student loan, that debt will generally be considered separate property, and the other spouse would not have any liability for it in a divorce. One exception to this would be if two people took out student loans before marriage and then combined their loans into one, which is no longer even permitted for federal student loans.

Additionally, if one spouse takes out a student loan while married, the law in an equitable distribution state like Ohio dictates that the spouse with the loan is solely responsible in the event of a divorce, unless the other spouse cosigns the loan. Though federal loans often do not require cosigners, many private banks will ask for a cosigner when student loans are refinanced.

Given the number of people who have student loans in this country, plus the fact that the average age at which individuals get their first divorce is 30, it is very possible that a person getting a divorce will have at least some student loan debt. Though the division of student loan debt is not particularly complicated, having a lot of debt can make it even more important for a person to ensure that he or she is receiving all assets to which he or she is entitled. People going through a divorce in Ohio might consider consulting with a local family law attorney.