When Parents Divorce After Borrowing Money for Their Children’s College Education
June 21, 2020
In recent decades, an increasing number of well-compensated professions require their practitioners to have university degrees, but at the same time, the cost of a university education has risen exponentially. Many young adults find student debt casting a long shadow over their futures. Parents who have the means to do so often spend generously to keep their children from needing to borrow money for college; if the child’s college savings fund does not have enough money, the parents might even take out loans in their own names, or else co-sign on their children’s student loans. As soon as the ink is dry on a student loan, it means that the whole family is in for many years of repayment. If you and your spouse divorce when you or your children still owe money on student loans, assigning responsibility for the loans can be one of the most contentious issues when it comes to division of property. The family law attorneys at Iwanyshyn & Associates in Greater Pittsburgh can protect you from getting stuck with an unfair portion of your children’s college debt.
Is It Your Responsibility to Pay for Your Children’s College Education?
According to Pennsylvania law, parents have a legal obligation to support their children financially until the children are eighteen years old. Many young adults need financial help from their parents, especially if they attend private universities. In general, if a parent is spending his or her own money to pay for a son or daughter’s college tuition, the court counts this as a discretionary expense; therefore, it does not count as an expense that would increase the amount of alimony you receive or decrease the amount of alimony you pay. If you and your spouse divorce while your child is in college, and you are paying all or part of your child’s college expenses, you and your spouse might be able to work out an agreement for how to continue paying them; your lawyers and a mediator can help you do this.
When the Loans Are in Your Name
If, at the time of the divorce complaint, you and your spouse have already borrowed money in your own names to pay for your young adult children’s education or other expenses, these are marital debts, and the court must divide them when determining equitable distribution. If the loans in your name are of roughly equal value to the ones in your spouse’s name, the court might just decide that each spouse will be responsible for the loans that he or she personally borrowed. If they are unequal, though, that could result in one spouse getting an unfair debt burden. If, for example, you owe $40,000 on a loan for your daughter’s college tuition, but your wife owes $5,000 on a loan for your daughter’s car, the court might order your wife to pay you some money each month to put toward the payments on the college loan.
Iwanyshyn & Associates Helps the Parents of College Students with Equitable Distribution
There is not a one-size-fits-all solution for how families should deal with student debt after divorce. Contact Iwanyshyn & Associates in Greater Pittsburgh & Western PA about your divorce case. 🡺 412-419-3448