Pre-Marital Debt question (School Loan)

[bd420]

What is the name of your state?
Michigan

I had an approximately $7,800 pre-marital debt incurred by government Stafford Loans. These loans were paid off with applicable interest, while I was married. I would assume that I will owe this $7,800 plus interest to my estranged wife. My question is, since I used the loan for the purpose of attaining a BS degree in Computer Science, and I've subsequently averaged a yearly salary over the 8 years of marriage of $46,540, which is substantially more than the avg salary for a non-degree worker, 'could' this be taken into account?

Thanks,

bd420

 

[LdiJ]

What is the name of your state?
Michigan

I had an approximately $7,800 pre-marital debt incurred by government Stafford Loans. These loans were paid off with applicable interest, while I was married. I would assume that I will owe this $7,800 plus interest to my estranged wife. My question is, since I used the loan for the purpose of attaining a BS degree in Computer Science, and I've subsequently averaged a yearly salary over the 8 years of marriage of $46,540, which is substantially more than the avg salary for a non-degree worker, 'could' this be taken into account?

Thanks,

bd420

Why do you think that you would owe that money back to your wife? Unless you gave preference to your pre-marital debt rather than the marital debt, when paying the bills (and your wife can prove that) I can't imagine why you would have to pay her back if you were working and contributing to the household budget.

 

[Shay-Pari'e]

Keep your freaking post's together.

 

[bd420]

are pre-marital assets treated differently then?

Why do you think that you would owe that money back to your wife? Unless you gave preference to your pre-marital debt rather than the marital debt, when paying the bills (and your wife can prove that) I can't imagine why you would have to pay her back if you were working and contributing to the household budget.

My atty wanted me to find out how much of my 401k was established prior to marriage, according to him, that amount is not owed to my estranged wife. Is that true?

If so, the debt I accrued thru the loan pre-marital is not relevant to the division of debt, however the assets accrued pre-marital would be? I thought that was the reason pre-nuptial agreements were signed, in other words, if I had pre-marital assets, without a pre-nup, those assets became half hers upon marriage in my opinion.

Thanks.

 

[LdiJ]

My atty wanted me to find out how much of my 401k was established prior to marriage, according to him, that amount is not owed to my estranged wife. Is that true?

If so, the debt I accrued thru the loan pre-marital is not relevant to the division of debt, however the assets accrued pre-marital would be? I thought that was the reason pre-nuptial agreements were signed, in other words, if I had pre-marital assets, without a pre-nup, those assets became half hers upon marriage in my opinion.

Thanks.

Let me see if I can give an example to make things clearer. Lets say that you have a 401K worth 10,000 when you get married, and student loans of 7000.00. During your marriage you cash out the 401K to finance a major purchase, and you also pay off your debts. Both the pre-marital debt and the premarital asset no longer exist....so are no longer relevant in a property settlement.

Now, if the debt or the asset still existed, then it would have to be determined whether or not the other spouse would share in that debt or asset....and that is very state specific.

Your 401K still exists, your attorney is saying that she is only entitled to 1/2 of the increase in the value since the marriage. The debt no longer exists.

If you want to keep your 401K intact, then you may want to offer other assets in exchange. What's imortant is that the total assets/debts get split fairly...not that each individual asset/debt get split.

 

[bd420]

Thanks for the clarification, that was excellent (m)

Let me see if I can give an example to make things clearer. Lets say that you have a 401K worth 10,000 when you get married, and student loans of 7000.00. During your marriage you cash out the 401K to finance a major purchase, and you also pay off your debts. Both the pre-marital debt and the premarital asset no longer exist....so are no longer relevant in a property settlement.

Now, if the debt or the asset still existed, then it would have to be determined whether or not the other spouse would share in that debt or asset....and that is very state specific.

Your 401K still exists, your attorney is saying that she is only entitled to 1/2 of the increase in the value since the marriage. The debt no longer exists.

If you want to keep your 401K intact, then you may want to offer other assets in exchange. What's imortant is that the total assets/debts get split fairly...not that each individual asset/debt get split.

We also have an incredible amount of Credit Card debt, which I completely disagree that 50% should be mine (I've used 1 credit card for 1 $30 transaction in the last 10 weeks), although there is next to no way I will be able to research every purchase made from every card we've ever had, all of which have always been solely in my name btw, due to her bad credit rating (I know, I know, how did I let her rack up so much CC debt? To be honest, it was a constant daily struggle, she spent money because it made her 'feel good' and less depressed, argh.), there are a few large ticket items that I was wondering if they could be considered soley her CC debt:
1) We paid off over $4,000 to a collection agency on a CC for an apartment lease that she broke 7 years ago (we were married, she decided to separate and move out, stayed in the apt for 3 months but signed a 12 month lease
).
2) She was arrested for driving while intoxicated (OUIL) and spent a nite in jail, and for her bail, I no choice but to use a CC, unless I decided to leave her in there, lol, that was about $500.
3) Related to #2 were her atty fees for the court hearing and plea bargaining that were also charged on a CC, that was about $750 I think.

Could any of these 3 items be reasonably considered debt solely on her behalf, ie, that she should be responsible for?

Thanks.

 

[LdiJ]

We also have an incredible amount of Credit Card debt, which I completely disagree that 50% should be mine (I've used 1 credit card for 1 $30 transaction in the last 10 weeks), although there is next to no way I will be able to research every purchase made from every card we've ever had, all of which have always been solely in my name btw, due to her bad credit rating (I know, I know, how did I let her rack up so much CC debt? To be honest, it was a constant daily struggle, she spent money because it made her 'feel good' and less depressed, argh.), there are a few large ticket items that I was wondering if they could be considered soley her CC debt:
1) We paid off over $4,000 to a collection agency on a CC for an apartment lease that she broke 7 years ago (we were married, she decided to separate and move out, stayed in the apt for 3 months but signed a 12 month lease
).
2) She was arrested for driving while intoxicated (OUIL) and spent a nite in jail, and for her bail, I no choice but to use a CC, unless I decided to leave her in there, lol, that was about $500.
3) Related to #2 were her atty fees for the court hearing and plea bargaining that were also charged on a CC, that was about $750 I think.

Could any of these 3 items be reasonably considered debt solely on her behalf, ie, that she should be responsible for?

Thanks.

Here is your problem. The cards are in your name. The credit card companies will not be a party to your divorce. Therefore even if the judge DOES order her to be responsible for 50% of the debt, let alone more, if she doesn't pay it YOU are the one whose credit will be destroyed.....and the credit card companies will come after you....no matter what the judge ordered.

You would be better off structuring the settlement so that you keep the debt, and equivalent assets to pay those debts.

Example: 20,000 in CC debt, 30,000 in home equity and 401k assets. You keep the first 20,000 of those assets and divide the rest with her. That way you protect your credit by taking responsibility for ensuring that the bills are paid.

 

[bd420]

Thanks for your reply, I understand what you mean

Here is your problem. The cards are in your name. The credit card companies will not be a party to your divorce. Therefore even if the judge DOES order her to be responsible for 50% of the debt, let alone more, if she doesn't pay it YOU are the one whose credit will be destroyed.....and the credit card companies will come after you....no matter what the judge ordered.

You would be better off structuring the settlement so that you keep the debt, and equivalent assets to pay those debts.

Example: 20,000 in CC debt, 30,000 in home equity and 401k assets. You keep the first 20,000 of those assets and divide the rest with her. That way you protect your credit by taking responsibility for ensuring that the bills are paid.

When you say the CC's are in my name, destroying my credit, etc, which is precisely why i'm keeping all of the CC related debt, what I'm saying is, of the $28,200 in CC debt that is to be negotiated, instead of me taking my $14,100 half AND her $14,100 half (this is 'on paper money' at this point), can I use any of the above 3 examples to help alleviate what I'm responsible for on my side of the ledger in the negotiation.

Ex: 28,200 in CC debt, based on points 1,2,3, 6k is DEFINITELY soley hers, therefore I'm responsible for (28,200 - 6,000) / 2 = 11,100 and she is responsible for $17,100 on her side of the negotiation ledger, this could mean the difference between a $12,000 exchange of my retirement to an account in her name, vs a $6,000 exchange of my retirement, for example.

So, yes, I AM most definitely keeping the cards, I just want to know if any of points 1-3) can be constituted as CC debt she is responsible for, so I can use that as a negotiation tool, or will it not be considered at all, and if not, why?