Are Student Loans Considered Marital Debt in an Illinois Divorce?

 Posted on June 08, 2021 in Divorce

Student loan debt is a serious burden for millions of Americans, with recent statistics showing an average debt of more than $30,000 among borrowers. Often, borrowers take 20 years or longer to fully pay off their loans. With this in mind, there is a good chance that if you are going through a divorce, you, your spouse, or both of you will have outstanding student loan debt. You should be sure to understand how this debt will affect the division of marital property, as well as your financial situation after the divorce.

Marital and Non-Marital Debt

One of the most important steps when getting a divorce is to take inventory of all of your assets and debts, as well as all those belonging to your spouse. Each spouse’s non-marital assets and debts will stay with them after the divorce, while marital assets and debts will be distributed fairly between the spouses. The question, then, is whether student loans qualify as non-marital or marital debt.

It is common now for people to wait until after graduating college to get married, meaning that many spouses have taken out student loans before their marriage begins. Student loans incurred before the marriage are an example of non-marital debt. However, if you or your spouse took out student loans during your marriage to further your education, they will most likely be considered marital debt. The fact that the loans financed only one spouse’s education, or that only one spouse signed on the loans, will not change their marital status. If you get divorced later in life after taking out loans in your name to finance your children’s education, these loans will also likely be considered marital debt.

Allocating Student Loan Debt For Divorce

Although some student loans may be considered marital debt, that does not necessarily mean that both spouses will be assigned equal responsibility for them in a divorce. Illinois law does not require a 50/50 division of marital assets and debts, but instead allows for a fair distribution based on the facts of the case. Some factors that a court may consider when allocating marital student loan debt include:

• Whether one spouse co-signed for the other’s student loans

• Whether one spouse made substantial sacrifices or contributions to allow the other to pursue an education

• Whether the degree funded by the student loans resulted in substantial income for the family, or a substantial increase in one spouse’s income or earning potential

Contact a Joliet, IL Divorce Attorney

If you or your spouse has student loans at the time of your divorce, the experienced Will County family law attorneys at The Foray Firm will help you understand their impact on your divorce. We can represent you in asset and debt division negotiations, or help you make the case in court for a fair distribution of debt if necessary. Contact us today at 312-702-1293 for answers to your questions and assistance with your case.

Sources:

https://studentloanhero.com/student-loan-debt-statistics/

https://www.bankrate.com/loans/student-loans/how-long-to-pay-off-student-loan/

https://www.ilga.gov/legislation/ilcs/documents/075000050k503.htm