Most people enter marriage believing it will last forever. They often agree to “for better or worse,” which can include financial choices. You might think that means that you share all of your assets if you divorce, but what about debt?

Debt of any kind can strain a relationship, but student loans can be particularly overwhelming. It is debt often deemed necessary by many people in order to complete their education and have a career. The amount of student loan debt is often significant and may have a high interest rate, which can make it difficult to repay. If you get a divorce and your spouse has student loan debt, you may end up having some responsibility for repayment. Here’s what you need to know.

Will both spouses be responsible for paying off the debt?

The first factor in debt reallocation is when the debt was created. If the debt existed before you got married, the person who accumulated it will be responsible for it, as it is separate property. If you took on the debt after marriage, it is marital property.

The responsibility of paying debt that is marital property depends on where you and your spouse live. People who live in community property states have debt divided evenly, just as with assets. Kentucky, however, is an equitable distribution state. This means that the court will divide the debt based on what it believes is fair. But how does the court determine what is fair?

Factors used to divide debt in divorce

The court considers several factors to divide debt in a divorce agreement. Here are four of their main considerations:

  • The purpose for the debt – Was all of the debt used solely for education expenses? If so, it may stay the responsibility of the student who took it on.
  • Contributions of the other spouse – Did the non-student spouse care for the shared home or support the student in other ways, such as driving him or her to class? The court may decide the non-student spouse doesn’t need to further contribute by paying off the debt.
  • The earning ability of each spouse – Who makes more money? If the non-student spouse makes less, he or she may not have as much responsibility to repay the loan.
  • Co-signing on a loan – Did the non-student spouse co-sign the student loan? If so, this legally obligates that spouse to repay the debt.

Conclusion

If you’re concerned about the effect divorce could have on your or your spouse’s student loan, you may want to seek legal counsel. It is important that you know exactly what you are or are not responsible to repay. It could significantly impact your divorce agreement and future plans.