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Responsibility for student loan debt in divorce

People in Michigan who are divorcing and who are carrying student loan debt might wonder whether that debt will be affected by the divorce. In general, student loan debt acquired prior to marriage remains the property of the person who took out the debt. Student loan debt acquired after marriage is treated like other asset in marriage, and it will be split in the divorce.

Prior to marriage, people should disclose any debt they have. At this time, they might draw up a prenuptial agreement outlining how they will handle debt if they ever divorce. However, people often do not want to discuss the possibility of divorce when they are getting married.

Another consideration is whether the couple consolidated their student loans. Prior to 2006, this was allowed, and it could result in lower interest rates for loans. However, it also means that if one person fails to pay their portion of the debt, the other may be responsible for the full amount.

How debt and assets are divided in practice may vary from couple to couple and might depend on how the divorce proceeds among other things. For example, if a couple negotiates their divorce with an attorney instead of turning to litigation, then there may be more flexibility in how the split is approached. One person might take the student loan debt that was acquired after marriage but that belongs to them while the other might take the credit card debt that they largely created. If the case goes to litigation, then the couple might have less input in the decision. They might also lack any recourse if they are unhappy with the judge's decision. A divorce attorney might be able to advise them about their options for negotiating debt and asset division.

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