Many people in Florida are dealing with extensive student loan debt. In some cases, people decide to delay marriage, children or major purchases because they are struggling to pay off loans that can amount to hundreds of thousands of dollars. With the costs of college rising, many people have few options but to take out student loans to pursue education for their future careers. At the same time, divorce is a major financial event. The effects of the end of a marriage on a person’s finances can last for years beyond the relationship. Couples dealing with student loan debt burdens may be concerned with how their loans are handled during the property division process.
In general, people who had their student loan debts before marriage will also retain the obligation to pay for them after divorce. Like other premarital debts, they will continue to remain separate liabilities. However, people may have more questions when the loans were acquired after the marriage began. In general, debt assumed after the marriage is marital debt, but that does not mean it will be divided equally between the spouses. Florida is an equitable distribution state, which means that marital debt will be divided between the parties on grounds of fairness.
There are several issues that will be examined when considering how student loan debt will be divided in property division. These include the use of the funds. If the money mainly went to pay for tuition and books, the loans are more likely to be considered separate property than if they also went to pay for the couple’s living expenses.
Student loans are only one of the many complex financial issues to be addressed during a divorce. A family law attorney may work with a divorcing spouse to negotiate for a fair settlement on property division and other legal matters.