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Student Loan Debt & Divorce – A Tough Pill to Swallow

In any divorce, dividing the marital assets and liabilities is often a surprisingly difficult task for the parties. Valuing assets and recalling whether assets or liabilities were incurred during the course of the marriage takes its toll on any divorcing couple. Student loan debt is often one of the more contentious topics when it comes to equitable distribution. Although one party may have benefited from the debt by obtaining a degree or taking courses, the benefit is not to be considered by the court when calculating equitable distribution.

As a general proposition, student loan debt incurred during the marriage is a marital liability. § 61.075(5)(a)(1), Fla. Stat. (2014). Thus, in the absence of specific findings supporting the unequal distribution of a student loan debt, such debt must be equitably distributed between the parties. The fact that one party will not receive any benefit from the other party’s education because of the dissolution is not a factor to be considered when allocating a marital debt for student loans. Thus, absent some other justification for an unequal distribution, controlling case law forbids a trial court from awarding student loan debt incurred during the marriage solely to one party or the other. Rogers v. Rogers, 12 So. 3d 288 (Fla. Dist. Ct. App. 2d Dist. 2009)

Further, Florida courts will not offset the student loan debt distributed to you during a divorce by the future earning capacity the student loans paid for. See Joachim v. Joachim, 942 So. 2d 3 (Fla. 5th DCA 2006). The majority view is that, although an educational degree could be considered by the trial court in distributing marital assets and in determining the propriety and amount of alimony, an educational degree is not property subject to distribution. A spouse’s claim to a vested interest in the other spouse’s education and professional productivity, past and future, is unsupported by any statutory or case law. The value of degrees, as measured by future earning capacity, is too speculative to calculate. Id.

So lets analyze this in the context of an actual divorce. Husband and Wife have been married for ten (10) years. Husband works in sales making $110,000.00 per year while Wife went to medical school. At the completion of the Wife’s medical training she incurred a total of $275,000 in student loan debt, which was all incurred during the marriage. Shortly after completing her residency, the Wife decided she wants a divorce. For purposes of equitable distribution, the Husband would be responsible for $137,500.00 of the Wife’s student loan debt. Typically, this means that the Husband would have to give the Wife $137,5000.00 from some other asset to offset the liability.

The bottom line when it comes to student loan debt is that if it was acquired during the marriage, Florida Statute section 61.075(a)1 defines it as martial. It does not matter who signed for the loan, if it was incurred while you were married, it is marital. If you are concerned with student loan debt incurred during a marriage, it might be beneficial to inquire about a prenuptial agreement prior to the marriage or a postnuptial agreement if you are already married.

Futher Reading: Dissipation of Marital Assets in Florida