Photo of Mysti Murphy

Standing Strong for Your Rights

Dividing consolidated student loans in divorce

On Behalf of | Mar 14, 2022 | Divorce

When most couples divorce, they take their student loan debt with them because the loans were taken out before they were married and are solely in their name. However, some couples are joint signers on student loans.

This can happen for a variety of reasons. Maybe one of them returned to school to get a graduate degree after they married, and their spouse co-signed the loan with them. Some consolidated their student loans. For a short time about twenty years ago, the Department of Education had a program that allowed spouses to consolidate their student loans for a lower interest rate and just one monthly payment.

If you and your spouse consolidated your loans through this or another program or if you co-signed a student loan with your spouse, you are just as responsible for making the payments as they are – even if most or all of the debt belongs to them.

Federal legislation has been introduced to address the problem

The problem affects enough people that a couple of members of Congress have crafted legislation that would mandate that married couples’ joint student loans be divided based on how much each of their original loans were for.

The proposed legislation applies to divorcing couples, but it’s also meant to help spouses who are victims of domestic violence more easily get away from an abusive spouse without taking that spouse’s debt with them. Part of the marital abuse is often economic. Refusing to make any payments on a consolidated loan and therefore forcing a spouse to do so or risk ruining their credit is one type of economic abuse.

Even if your spouse isn’t intentionally trying to hurt you, they may still not be reliable about paying their share of student loans for which you have joint responsibility. Even though Texas is a community property state, you and your spouse, with legal guidance, may be able to work out an agreement that would help ensure that you’re not saddled with paying their student loan debt as well as yours. Find out what options are available given your specific circumstances.