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Serving Iowa Families Statewide

How Student Debt is Treated in Divorces


Student debt is a relatively new problem facing younger generations of Americans. In the past, attending college or university did not cost nearly as much as it does now. Today, most students find themselves overwhelmed with potentially thousands of dollars of debt for student financial aid.

Financial issues are among the leading points of conflict for divorced couples. Iowa law regarding how the responsibility for student debts is determined upon divorce can be complicated. First, the state’s law regarding the division of assets and liabilities must be considered. Next, the specific circumstances surrounding the divorce are taken into account when determining and dividing student debt obligations upon divorce.

Equitable Distribution in Iowa

Under Iowa law, all marital assets and liabilities are subject to equitable distribution upon divorce. This means that all property acquired during the parties’ marriage will be divided fairly under the circumstances. As a corollary, the liabilities of the marriage are also distributed justly in light of relevant circumstances.

When it comes to dividing marital property, the law presumes that all property owned by the parties is part of the “marital estate” and subject to equitable distribution at divorce. In contrast, the equitable division of marital debts and the liability of the spouses’ assets—whether separate or marital—depends on certain factors.

Courts will examine the following factors when determining the just division of liabilities upon divorce:

  • The length of the marriage
  • If the debt was incurred while the parties were married
  • Which spouse benefitted most from the loan proceeds
  • The expenses for which the loan proceeds were ultimately used
  • The effect of education on the spouse’s earning capacity
  • The financial condition of the other spouse
  • The terms of an applicable marital agreement, including prenuptial agreements

If these factors strongly suggest that one spouse primarily benefitted from—and was financially responsible for—the loans during the marriage, a court will be more inclined to rule that the benefitted spouse is liable for paying off those loans. However, a court could also consider the nature and extent of any support a spouse provided to the student-spouse while they attended school. For instance, the other spouse might have assumed more parental responsibilities if they had a child together, or the other spouse may have gotten a new job to cover additional expenses.

For Quality Legal Representation, Call Hope Law Firm at (515) 305-2772

If you are looking for an experienced attorney for legal advice about your divorce, look no further than Hope Law Firm. Our legal team is committed to helping you and your family find an effective and fair resolution to your legal issues, including those related to the division of property and debts upon divorce.

Schedule an initial case evaluation with a member of our legal team by calling our office at (515) 305-2772 or visiting us online today.