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Navigating student debt in a divorce

Close to 45 million Americans have student loan debt, some of whom will go through a marital break-up before it is paid off. For Massachusetts individuals considering their debts and assets as part of a divorce, student debt can raise property division questions. Is the loan jointly held if it was taken out during the marriage? Can a spouse be held accountable for previous promises to help with the debt? The answers to these questions depend, in large part, on what state you are in and the type of loan involved.

Generally speaking, the person responsible for a student loan is the person named on the debt. The most straight-forward situation here is a person taking out a loan prior to their marriage. Loans that pre-date the marriage, where one party is clearly named, continue to be that person’s responsibility.

In most states, when both spouses are on a loan, the responsibility for repayment is joint. A few states, called Community Property states, may rule differently, as they divide assets and liabilities more evenly between both spouses. Massachusetts is not a community property state. However, factors like the type of student loan, co-signers and refinancing could play a role.

Property division can be complicated when it comes to both assets and debts. Those who cannot make payments due to financial hardship can explore repayment plans, deferments and other options with their banks. Working toward a fair and equitable divorce agreement with a lawyer can help to protect one’s interests in a divorce as well as clarify the standards in Massachusetts family law.

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