Student loans


#1

My cousin’s wife was in law school when they married and had taken out loans to fund this. She continued receiving money for 2 years after they were married. 10 yrs. later, she has not made a payment on them in 3 yrs. He needs to leave this relationship and cannot get any answers from her about how much of these loans he will be responsible for. With interest and the non-payment penalities, he thinks they total over $110k. For 2 years, the IRS has kept his tax refund to apply towards her loans. He can’t really make any decision about how to proceed with leaving without knowing the details about these loans and she is purposefully not telling. Would a divorce attorney be able to help search out these loans and how much he’s responsible for or would he need some other type of attorney to investigate this? Maybe a tax/finance attorney? One time on here, he was told that he was not responsible since only she signed for them but since the IRS is taking his refund, it would seem that his name is attached to them in some way.


#2

If your cousin leaves his wife, he can file a suit for equitable distribution of the marital estate. Through the process of discovery, he can obtain information about the student loan debt.


#3

The problem is that he is in his 50s and doesn’t think he can leave if it means he will owe $55k for her student loans and the interest and non-payment fees. His job is not nearly as lucrative as hers would be if she would work. She has never worked as an attorney (or anything else) since she got out of school so he is the only breadwinner. He cannot afford to take 1/2 of these loans and 1/2 of all the other debt he would most likely have to assume if he left. Since they have garnished HIS tax refund, the federal government must assume that he is liable. When he sent in a claim as an “innocent” spouse (or whatever it is called) to try to retrieve his refund, it was not granted. He never signed anything but it would appear that he is being held responsible. Is there a way he can find out whether he is liable without her knowing before he makes the decision whether to leave or stay?
Another issue is that she has refused to work for the past 9 years. They have no children that need her care. So even though she is a licensed attorney with no physical or mental disabilities and is able-bodied to work, would he have to pay her spousal support just because she doesn’t want to work?


#4

If the bank is having his taxes garnished (and not joint tax returns), it would seem he should be able to get access to the loan information. Without filing a lawsuit, there is no way to subpoena records. The parties have to be separated to file a claim for equitable distribution.

If the court finds that he has been the supporting spouse, he could be liable to pay spousal support.


#5

The bank did not garnish taxes. It was a joint return although she did not work either year so it was basically his refund. IRS sent him a letter saying the refunds were being applied towards outstanding federal student loans. He applied for his portion as the innocent spouse but didn’t get anything back. From my interpretation of your answers, it doesn’t appear he can afford to leave if he has to assume half of her loans, half of all other debt, AND pay her spousal support. How can a judge grant support to a young woman with a law degree who refuses to work because she believes it is the husband’s “responsibility” to support her!!! Poor guy…


#6

When I said the bank, I meant the lender. The lender in your situation is the federal government. This was the first time you mentioned it was a joint return. If he had not filed a joint return, I don’t think they would have been able to garnish his tax return, but then again, he wouldn’t have as big of a standard deduction, and likely wouldn’t have had as big of a tax return for them to garnish, which is likely why his innocent spouse request was denied.

The loans taken out prior to the marriage aren’t marital. How the courts would distribute the marital portion is still in dispute. Recently, we’ve seen courts attribute the portion of the loans used for living expenses to both parties and make the spouse who received the education responsible for the remainder.