Even divorce might not free you from your ex’s student loan debt

Angela Powell, a enterprise analyst in Texas, has been attempting to untangle a joint consolidation loan from her ex-husband since their divorce in 2014. Powell’s ex-husband stopped commonly paying on the loan years in the past.

Katie Hayes Luke for NPR


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Katie Hayes Luke for NPR


Angela Powell, a enterprise analyst in Texas, has been attempting to untangle a joint consolidation loan from her ex-husband since their divorce in 2014. Powell’s ex-husband stopped commonly paying on the loan years in the past.

Katie Hayes Luke for NPR

Angela Powell met her “prince” throughout her freshman yr of faculty. She had goals of a contented marriage, a profitable profession and a few nice youngsters. After commencement, she bought married and began on the opposite two, attending enterprise faculty whereas her husband bought his regulation diploma, earlier than the 2 settled down to start out a household in Arizona.

Around that point, they determined to consolidate their loans below a brand new Department of Education program for married {couples}. The perks have been excessive — a decrease rate of interest for his or her debt and just one fee to fret about per 30 days.

“I didn’t think it was a big deal because we’re going to pay all this off. We’re going to be married forever, right?” Powell stated. “Fast-forward to the housing market crisis in 2009/2010. Not a happy marriage anymore. Everybody loses their jobs.”

After the divorce, Powell’s relationship together with her ex soured. Documents reviewed by NPR present he has not made common funds to the loan since 2016. That’s regardless of the actual fact he’d initially taken out virtually double her debt. Through consolidation, they’re now on the hook collectively for almost $200,000 — greater than 5 instances the quantity of Powell’s preliminary loan.

“I’m stuck with having this thing on my back,” says Powell, “and knowing that at the end of the day, if he chooses not to pay, guess what? My monthly payment is $1,942.50.”

More than 14,000 debtors participated within the short-lived program, which Congress shuttered in 2006. It appeared like a easy idea: Joint consolidation loans allowed for {couples} to have one single month-to-month fee with a decrease rate of interest. The downside got here when attempting to separate loans within the case of divorce or home violence. The program has no solution to disentangle the money owed.

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“It seems pretty straightforward. If you can put something together, you can take it apart,” says Patrick Stebly. He has been on this state of affairs since his divorce in 2013 and has spent the final 5 years attempting to vary it for everybody else.

Stebly’s advocacy has impressed laws to treatment this downside. Introduced by Sen. Mark Warner, D-Va., and Rep. David E. Price, D-N.C., the invoice would permit, in circumstances of divorce or home violence, for joint loans to be cut up proportionately primarily based on the unique loan quantities. Nearly half a dozen households on this state of affairs informed NPR that is the repair they want.

Holly Rodriguez discovered herself answerable for each her and her ex-husband’s student loans.

Parker Michels-Boyce for NPR


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Parker Michels-Boyce for NPR


Holly Rodriguez discovered herself answerable for each her and her ex-husband’s student loans.

Parker Michels-Boyce for NPR

Warner first launched the invoice in 2017 after a constituent reached out about paying her abusive ex-husband’s student loans. She had moved from Florida to Virginia to get away from him.

“While she physically got away, she couldn’t get away from this mutual debt … from an abusive husband. That’s just wrong,” stated Warner.

Once the invoice was launched, folks from throughout the U.S. contacted the senator’s workplace asking for reduction from the consolidation program.

There is not any information on how most of the preliminary debtors have since separated, however nationwide and state home violence reduction organizations say financial sabotage— like tanking a partner’s credit score — is likely one of the prime ways utilized in abusive relationships.

“It’s so powerful that many survivors cite their ability to provide financially for themselves and their children as one of the top reasons that they stay in an abusive relationship,” says Monica McLaughlin of the National Network to End Domestic Violence.

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NPR spoke to debtors who had skilled bodily and psychological abuse from former companions who now refuse to pay their student loans; they are saying Warner’s laws would set them free.

“There are so many barriers that survivors face,” stated McLaughlin. “Let’s knock this one down and look to the next one.”

Stebly and his ex-wife depend themselves among the many fortunate ones. They have an amicable relationship, so after they separated, they put collectively a courtroom settlement to repay their loans: His ex-wife pays her portion of the loan to him, after which he pays the loan supplier. It’s a workaround, nevertheless it has some drawbacks. His ex-wife ought to be eligible for Public Service Loan Forgiveness, however she can not declare it to erase her debt as a result of their loans are consolidated.

Officials have informed Stebly time and again: It would solely take lower than 1,000 phrases to repair this downside and separate their loans — however these phrases should be authorized by Congress.

“I’ve been banging out a thousand-word emails trying to talk about this thing, you know, daily for a while, trying to get somebody excited about this,” Stebly stated. “To me, it seems very straightforward.”

Holly Rodriguez hugs her youngest son, Iommi, at her residence in Richmond, Va.

Parker Michels-Boyce for NPR


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Parker Michels-Boyce for NPR


Holly Rodriguez hugs her youngest son, Iommi, at her residence in Richmond, Va.

Parker Michels-Boyce for NPR

Holly Rodriguez agrees. She’s a single mom of two in Richmond, Va., and is reckoning together with her choices from twenty years in the past. She’s getting a divorce, she’s in default on her student loans — and the 2 points are extra associated than it could appear.

Rodriguez’s loan now quantities to virtually $72,000. The bounce comes from consolidating together with her husband’s loan, curiosity and about 10 years of tenuous funds.

“We did pay initially,” Rodriguez stated. “And then my husband, soon after my daughter was born, lost his job. That put our finances in a very hard place.”

Rodriguez works in fundraising and communications for nonprofits; her ex-husband works within the restaurant trade as a line cook dinner and a dishwasher. Both went by way of durations of unemployment and confronted medical setbacks over the course of their marriage.

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Finances have been “a very contentious element of our marriage when we were together,” she says, and their separation wasn’t amicable. In 2018, she filed for, and was granted, a protecting order for her and her youngsters. It was later dismissed.

Given all that, getting her ex to pay up on student loans wasn’t a prime precedence — however the assortment company stored calling. So Rodriguez contacted her loan servicer to let it learn about her state of affairs. She supplied her husband’s contact data and proved he was employed, nevertheless it did not matter.

The loan was in her identify, and the loan servicer stated if she wished him to pay, she must work it out with him.

Rodriguez says her husband stopped common funds on their student loans years in the past. After repeated requests from NPR, he did not reply for remark.

“I was told, ‘Yes, he co-signed with you, but you signed the paperwork first, so we pursued you first,’ ” Rodriguez stated.

Afraid any missed funds would instantly impression Rodriguez’s credit score rating, she took on the whole thing of the debt.

“The thing is, I don’t mind paying my student loans back, but I do have a problem with having to pay for my loans and his loans,” Rodriguez stated. “I’ve been paying debt that isn’t mine, and that’s not OK. There’s nothing that makes sense about that.”

For two years, joint consolidation debtors may gain advantage from the pause on federal student loan funds, however that may change in just some months: Payments begin again up on May 1. President Biden has made his aversion to widespread debt forgiveness clear.

Advocates and lawmakers acknowledge {that a} legislative repair ought to be a straightforward repair to make. “Even when things are totally logical and rational, stuff takes longer than it should in Congress,” Warner says.

Getting the laws by way of the gears of Congress — the identical Congress that did not cross Biden’s social spending bundle and up to date voting rights laws — might show difficult.

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