When tying the knot, most people who took out student loans to pay for college are not thinking about how their debt may affect their new nuptials. Further, most newlyweds are not contemplating how their new spouse’s debt may affect their personal finances. In many states, debt and income are viewed as “community property” or “marital property.” This means that what is owed by one spouse is owed by both. Both spouses are jointly and severally liable for each other’s debts. Borrowers may be surprised to find that one of the most significant types of debt that can impact marriages is student loan debt.
If one spouse becomes in default on his or her student loan payments, loan servicers or debt collectors can seize the tax returns of both spouses to repay the outstanding student loan debt originally owed by only one spouse. Marriage can have an effect on student loan debt that is similar to that of a retroactive co-signer or guarantor. A co-signer is a person who executes a contract in concert with one or more parties. In performing this act, the co-signer is agreeing to fulfill the contractual duties of another in the event the other person is unable or unwilling to perform under the terms of the contract. Oftentimes, what the co-signer is agreeing to perform is the payment of the debt in the event that the other party fails to pay.
Generally, a co-signer on a contract makes the agreement to be legally responsible for fulfilling the terms of the contract at the time the contract is initially entered into. The effects of marriage in regards to student loan contracts are quite unusual. Spouses oftentimes had not even met their spouse at the time he or she took out their student loans to finance their education. In many cases, the spouses may have met years after graduating from college. Further, unlike the typical co-signer who willingly agrees to share liability for a contract, these new spouses never voluntarily agreed to co-sign for the student loans of their partners.
Student Loan Law Group helps borrowers and spouses of borrowers fight tax and wage garnishment as well as unfair debt collection practices. Student Loan Law Group consists of attorneys who represent borrowers in default or who are facing imminent default on their student loan payments. Borrowers seeking to be more informed on their rights and the rights of their spouses when it comes to student loan debt should contact Student Loan Law Group today.
