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Divorce and student loans

Many Arizona residents used student loans as a way to pay for their higher education. While this type of debt is often burdensome, it can take on special significance during and after a divorce.

Many people first start taking out student loans before they get married. In such cases, the responsibility for paying off the debt rests with the spouse who actually took out the loan. However, if a spouse takes out loans during the marriage, there may be some issues if the court will be making the property division determination. Arizona is a community property state, and thus courts in general will divide both debts and assets obtained during the marriage equally between the parties.

Another factor to consider is whether the couple consolidated each of their individual student loans into one obligation. Although Congress eliminated this practice in 2006, there may be couples who did so prior to that date and who are now divorcing. They will both be responsible, even if the original loans were incurred prior to their marriage.

Couples with student loans who had foresight may have addressed this issue in a prenuptial agreement. However, for those who did not, or who are concerned that the agreement is not valid, may want to handle this in other ways. If they can communicate with each other on an amicable basis, their respective attorneys might take the lead in negotiating a property division settlement. This could take into account any income disparities between the parties. Another way to handle this could be mediation, which could be quicker and less expensive than going to court.

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