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Do you have to divide student loans in divorce?
Divorcing couples need to split up their marital assets, such as the contents of a bank account or their retirement savings. They also have to split up their marital debts. This could include a car loan, credit card debt, a home mortgage and things of this nature.
Where some couples have questions, though, is when it comes to student loans. Clearly, if only one person is going to college, they are the one benefiting from those student loans. But is the debt owned jointly, and do they have to divide it during the divorce? Or does the debt just stay with the student?
When did they take on that debt?
Often, the question is when a couple acquired the debt. If they did so after they were already married, it is likely marital debt, and they are both responsible for making the payments. For instance, perhaps the couple got married, and then one person decided to go back to school so they could get an advanced degree. This benefits them both, and they agreed to the debt together, so they both have to pay it back—even though only one person is actually a student.
How does a collaborative divorce differ from a traditional one?
No law states a divorce must be a highly contentious affair with yelling. In fact, most people would prefer a more civil option.
Fortunately, a collaborative approach to divorce offers a way for couples to settle their differences without the courtroom drama.
Mutually beneficial
We are all familiar with the traditional divorce model. Each spouse has their own attorney to litigate on their behalf. The goal is to "win" on key issues such as child custody, property division and alimony. Formal court hearings can last for months, costing spouses time and money.
A collaborative divorce is focused on both parties coming to a mutual agreement. Before the process begins, they both sign a contract stating neither will pursue litigation. While they both may have legal representation, other professionals can also be involved. Financial advisors and family therapists can offer assistance to guide the decision-making. If negotiations break down and the divorce needs to move to court, they must hire new attorneys, and the whole process starts fresh.
What happens to the family business if owners divorce?
When a couple owns a business together, they both likely play an integral part in keeping it operational. They both put in hard work and a lot of hours to help the business to remain successful. It’s not a pleasant thing to think about, but a couple that’s considering divorce will have to determine the fate of the company.
There are a few options that they can explore for the family business. Taking a look at the circumstances and being realistic about what’s possible may help them to determine how to proceed.
Options for the business
Some people opt to sell or close the business because of the divorce. It can be challenging to find a buyer for some businesses, so that may not be possible.
One spouse may buy out the other’s share of the business. This would mean that the business is only owned by the buying spouse so the other spouse won’t have any remaining interest in it.
How can I make sure my retirement accounts are safe in my divorce?
If you’re like many Americans who have been in the workplace for a few decades or longer, a good deal of your assets may be in retirement accounts of various types. You may have a 401(k) or an individual retirement account (IRA). You may have a pension plan – particularly if you work for a local or state agency — or a thrift savings plan (TSP) if you work for the federal government.
If you are going through a divorce, you and your spouse may need to negotiate if and how you both want to divide your retirement accounts. If you’re not able to agree, a judge will need to make the decision based on Virginia’s equitable distribution laws. One advantage of choosing a collaborative divorce, however, is that it may allow you and your spouse to work out your property division plan outside of court, with the support of your individual legal representatives.
Dividing a 401(k) plan
If you have a 401(k) plan through your employer, you’ll likely need to use a qualified domestic relations order (QDRO) to divide it. This is for "qualified" plans like 401(k)s established under the Employee Retirement Income Security Act of 1974 (ERISA).
The benefits and drawbacks of using mediation for your divorce
Going through a divorce can be tough, emotional and daunting. As couples consider their options, mediation is among the common alternatives to traditional litigation.
But is mediation right for everyone? As you consider this option, you may ask: How can mediation help achieve a resolution to my divorce?
What is mediation?
The mediation process involves a neutral third party facilitating a conversation between two parties to help them reach a mutually beneficial agreement. A mediator does not make decisions for the parties but helps them identify common goals and find creative solutions to their disputes.
In a divorce, mediation can provide a forum for spouses to talk about and negotiate the terms of their divorce. The terms can include property division, spousal support and child custody.
Pros of mediation
Mediation can offer benefits, including cost savings, confidentiality and reduced conflict. In addition, mediation can allow couples to tailor their agreement to their needs and circumstances instead of getting decisions from the court.
Do co-parents need to use the same house rules?
When parents split up in Virginia, the court may issue a custody order. This typically addresses two main areas: Physical and legal custody.
Physical custody refers to where the child will live, which parent they’ll be with, and when the parents will make exchanges. One parent may have primary custody, while the other parent may simply have visitation rights or custody on the weekends. In other situations, custody may be an even 50-50 split. Every case is unique.
Legal custody, on the other hand, involves making important decisions on the child’s behalf, such as where the child will go to school or what type of medical care they will receive.
Rules may differ between households
That said, custody orders typically do not specify what rules the parents must use. For example, parents may have very different curfews for their children or different stances on when the children can use technology or certain devices. As a general rule, unless there is a clear danger to the child, the court allows parents to make these decisions independently.
Approaching holiday custody with compassion and common sense
The winter holidays are typically celebrated with family and friends. However, when divorce splits a family, it can be expected to affect the minor children of the former couple.
As adults who must co-parent, a certain level of civility is required to arrange custody exchanges and other important events. Below are some suggestions that can help bring former partners closer to the goal of making the holidays truly happy for the kids.
The art of compromise
If it was a particularly devastating divorce (at least to one party), it can be a real challenge to set aside any personal animosity and work together for the best interests of the chlid(ren).
Suppose your family tends to gather kin from out-of-town to celebrate the holidays over a groaning table filled with Thanksgiving favorites. However, your family may prefer the traditional Christmas Eve Feast of the Seven Fishes and a late midnight Mass. It’s only common sense to make the swap if the holidays fall on the other parent’s weekend.
Identifying hidden assets during divorce: 2 clues
Unfortunately, a spouse may hide assets during their divorce. Perhaps they believe they have a stronger claim to some properties and, hence, they don’t want those assets to be subject to property division. Or they want to avoid paying alimony or at least lower their spousal support obligation by misreporting their income and assets. Some people even hide assets during divorce to keep more to themselves.
Regardless of the reason for a spouse hiding assets, if this is not discovered, a divorce may end in unfair decisions concerning property division, alimony and child support. So, how can you determine that your spouse is hiding assets? Here are some clues:
Inaccurate financail informataion
Spouses should exchange financial records during divorce to ensure each party is well-informed about the other’s financial situation. You should be concerned if your spouse refuses to cooperate. Possibly, they refuse to give you their financial documents or keep giving excuses.
Two important considerations when divorcing over the age of 50
Couples often envision growing old together as a harmonious journey, sharing both life’s highs and the inevitable lows. However, for some, the golden years bring about a stark realization: it is best to walk the path forward separately. When children are grown and the distractions of raising a family fade, these couples are left to face an uncomfortable truth — that they no longer share the same interests and goals.
This scenario is becoming increasingly common, prompting many to consider a "gray divorce." Divorcing after the age of fifty comes with unique challenges. Two of the most common are financial and the impact on adult children.
#1: Financial considerations when wealth is established
Divorcing later in life often means that the financial stakes are higher, as couples may have accumulated significant assets or may be nearing retirement. Important financial considerations at this stage in life could include:
- Retirement funds and pensions: Understand how these will be affected and divided. Legal mechanisms like Qualified Domestic Relations Orders may be necessary.
Protecting your privacy during divorce
For the most part, information shared in court proceedings is publicly accessible- and this includes divorce cases. This can be stressful for divorcing couples, and they may feel like their privacy has been invaded on top of all the other stress.
Fortunately, there are ways to protect your privacy during divorce. Here are a few things to consider.
Reaching out-of-court agreements
Divorcing couples aren’t obliged to fight out every aspect of their divorce in court. Negotiations can be held outside of court, and the judge can sign off on these agreements if they are lawful. The less time you spend in court hearings, the greater your chances are that your information will remain private.
In fact, divorcing couples may opt to go one step further and not hold any of the proceedings in court. Mediation and other collaborative methods allow the entire divorce to take place outside of court. Sessions are held in a much less formal setting, with only the spouses, legal teams and mediators having access to sensitive information.
A New Beginning for You and Your Family
Take the first step toward securing your peace of mind. We will give you the care your family deserves.
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Located in Reston, VA, Nicole M. Burns, Attorney at Law represents individuals and families throughout the area, including Annandale, Arlington, Ashburn, Bristow, Broadlands, Burke, Centreville, Chantilly, Dale City, Dumfries, Dulles, Fairfax, Falls Church, Gainesville, Great Falls, Haymarket, Herndon, Lake Ridge, Leesburg, Manassas, McLean, Montclair, Nokesville, Oakton, Potomac Falls, Sterling, Tysons Corner, Vienna, Woodbridge, Fairfax County, Loudoun County, Prince William County, and Arlington County.
