It’s one of the most magical milestones of your life. You’re marrying the person of your dreams. The venue is set, the invitations have been sent and the perfect dress is finally ready for it’s big debut. But before you officially walk down the aisle, you might want to find out exactly what kind of debt you may also be walking into.
“Wait, there’s more to marriage than love?”
Oh, yeah. It’s a whole partnership, not just in life, but also in financial obligations. But before you go all Runaway Bride, below are 3 things you need to know to keep both your marriage and your student loan payments as blissful as possible.
1.) “My loan payments are based off of my income, will this change when I get married?”
Short answer: they sure can, but they don’t necessairly have to. The main borrowers affected by marriage are those enrolled in an income driven plan (IDR). If this is you, listen up! In any IDR, if you file separately, you should be good to go with your current payment (pending that your own income hasn’t changed). However, if you decide to you file jointly come tax time, your income could alter – potentially knocking you out the financial bracket needed to stay in your current repayment plan. It may seem black and white, but there are some things to consider before checking that, “married filing X” box. On the flip side, choosing to not file jointly could also cause you to miss out on certain tax incentives that you could have potentially benefited from such as additional exemptions or possible tax deductions. To know which filing status is best for your unique financial situation, talk to a tax pro for advice before you file or change information on your W2’s.
2.) “What if we both have student loan debt, can we consolidate together?”
Unfortunately just because you’re together from a legal standpoint, doesn’t mean your student loans can be united in matrimony. Student loans will typically stay in the original borrower’s name and can not be lumped into someone else’s payment plan. If you and/or your future spouse have yet to consolidate your individual loans, there’s no better time than the present! If you need help finding or filing for a repayment plan to fit your newly wedded needs (and budget), 3rd party experts like the folks here at Docupop are away here to assist. Click the button below to see which great programs are available to you today!
3.) “Til Debt Do Us Part?”
Lastly, the big question on most couple’s minds: who is ultimately liable for the debt? The answer: well, it kind of depends. Here’s are the basics. If you have federal student loan debt that you (or your future spouse) acquired before the marriage, typically the original borrower is the only person held liable. Meaning if you divorce or if the borrower passes away, the debt either stays in their name or is wiped clean if/when death occurs. Whew… good to know! But, if any of your loans are private, this may or may not be the case. Ultimately you will have to check the fine print on any private loan to determine liability. The moral to the story here… if you want keep your loan life and upcoming marriage as student loan stress free as possible, know your options BEFORE you COMMIT…to changing your plan or paperwork of course.
So cheers to life, love and loan happiness… to death do you ALL part.
Disclaimer: Docupop is a private company, not affiliated with the Department of Education. The DOE offers several programs that may offer lower monthly loan payments for borrowers who meet the qualifications based on income and family size. Lower monthly payments may lead to longer student loan maturity periods, increasing the total amount of interest over the life of the loan. The DOE also offers programs that may forgive some or all of the borrower’s loan balance. The Public Service Loan Forgiveness program (PSLF) is based on the number of qualified payments made under the program while working full-time for a qualifying employer. Other programs require a specific number of qualifying payments and then forgive the remaining balance once those payments are completed, without any public service obligation. Depending on the type of forgiveness, any amounts forgiven may be treated as taxable income for income tax purposes, please consult your tax professional. More information can be found on the DOE website: https://studentaid.ed.gov/sa/repay-loans/forgiveness-cancellation