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May 2021


Divorce and Student Loan Debt

Divorce is messy. Dividing assets and equitable distribution of property is often the most tedious and time-consuming part of divorce. While division of hard-earned assets can be painful, what happens to joint debt when couples go their separate ways? Joint credit card debt is one thing, but what about student loans? What if one spouse borrowed money for the other to attend college, only for that spouse to drop out of school? Is that spouse still on the hook for student loan payments?

Joint Marital Debt

 New Jersey laws require parties seeking divorce to undergo equitable distribution of assets and liabilities. This process entails a complete inventory of all personal and real property, gifts, vehicles, investment accounts, intellectual property, bank accounts, retirement and 401k accounts, and debt accounts such as credit cards, personal, installment or car loans, and student loans. Each party is required to submit a financial statement to the court detailing their monthly income and expenses. The court uses the financial statement and additional evidence to make awards of spousal support and child support, if requested.

When it comes to debt, the courts will look at the source of the debt and when it was acquired to determine if it is joint marital debt or the sole debt of each party. If the debt is joint, the court will work with the parties and their attorneys to determine an equitable division of that joint debt. Contrary to popular opinion, equitable does not always mean a true 50/50 split. If a debt account was opened prior to the marriage, the court views that debt as the responsibility of the sole debtor/party. Conversely, a joint mortgage or a car loan co-signed by one spouse for the other spouse would qualify as joint debt. Sometimes the parties will submit evidence indicating that they or the other party was already making payments out of their own bank accounts or with their income. But even a prior financial arrangement is sometimes not enough to defeat the fact that the debt was taken out jointly with both parties’ informed consent.

Next Steps for Student Loan Debt

Student loan debt is complicated for several reasons. Firstly, often student loans were acquired prior to the marriage when both parties were still in college. Second, the U.S. Department of Education will combine joint student loan debt for married couples if the borrower chooses an income based repayment option, and make financial aid awards based on the joint income and fiscal need of married couples as well. So, if both parties have student loan debt, how is it divided? If the student loan is a private loan obtained through a bank using only one party’s income prior to the marriage, that student loan is not joint debt. If a federal student loan is obtained during the marriage, both spouses are listed as borrowers and rates/amount was determined using the parties’ joint income at the time, it is considered joint marital debt, and therefore must be equitably divided between the parties. Sometimes the courts will view a college degree as a marital asset if both spouses made a collective decision for one spouse to obtain the degree after marriage, and doing so increased the spouse’s earning potential and the standard of living for the couple.

Dividing student loan debt can be fact-intensive and is not cut and dry. If you questions about your joint debt, student loan debt or your spouse’s student loan debt, contact our attorneys at Eveland & Foster. Remember that after divorce, it is important you update your loan servicers and account management or financial advisors about your new marital status, or if one borrower needs to be removed from an account. It is also possible to request deferment of a federal student loan or recalculate an income-based repayment plan accounting for your sole income after divorce.

Call Eveland & Foster, LLC Today

If you or a loved one is facing a divorce and dealing with division of joint debt, including student loan debt, you need assistance. Our attorneys at Eveland & Foster, LLC specialize in family law including equitable division of joint assets and liabilities. If retained, we will assist you to arrive at a desirable outcome and protect your interests. Do not settle for less than what is rightfully yours, and do not take on debt that does not belong to you, just to expedite the divorce process. Call us today to schedule a consultation and review your options.

Ex-Spouse Preventing Visitation? You Have Options

The divorce is final, and your ex was granted sole physical custody of your child. You were granted visitation every Saturday for eight hours, in a location you choose (your home or an outing). Two months have gone by, and your ex repeatedly cancels, claims your shared child is sick, or simply does not show up at the agreed upon pick-up/drop-off location. You have not seen your child in months, have not been able to speak to them on the phone, and are understandably distraught. Is there anything you can do? After all, you have the right to see your child and have been complying with the court order. Shouldn’t your ex do the same?

File a Motion to Compel

 Track your visitation schedule immediately after it goes into effect. This includes days where your ex is late to drop-offs or refuses to release the children to you. The visitation log can be used in court. The Parenting Plan you and your spouse created is intended to govern custody facilitation, including logistical issues. Your ex is required to adhere to its provisions, including providing for your visitation with shared children. After you have documented multiple attempts to contact your ex-spouse and no progress or communication has been made, our attorneys at Eveland & Foster can file a motion to compel visitation against your ex in family court. The motion will outline the current situation, specific clauses from the custody order and parenting plan,  and incidents in which your spouse has prevented your legal visitation with your shared child from occurring. If the court grants your motion to compel, your ex will be under court order to comply with this new motion along with the provisions of the custody order. Courts do not look favorably upon parents attempting to deny the other parent’s right to see their children.

Schedule a Consultation Today

If you or a loved one need help with a post-divorce custody or visitation dispute, contact our attorneys at Eveland and Foster,LLC. We practice exclusively in family law, including post- divorce modifications. You have the right to see your child, and your ex does not have the right to keep them from you without court intervention. If retained, our family law attorneys will advocate on your behalf to seek a resolution. With offices located in Morristown, we serve clients throughout central New Jersey. Call today to schedule a consultation.

Disclaimer: This website and information presented are for the purposes of legal marketing and general education. No part of this site should be construed as legal advice. Please consult with an attorney regarding your specific situation. Please do not submit any confidential personal information through this website either by email contact form or chat. No aspect of this advertisement has been approved by the Supreme Court of New Jersey. We welcome your inquiries and offer consultations, however neither contacting our firm nor receiving a consultation establishes an attorney-client relationship.

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