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Read our latest Financial Settlements guide (2021)

What are we each entitled to in our divorce settlement?

What does the law say about how to split the house, how to share pensions and other assets, and how much maintenance is payable.

What steps can we take to reach a fair agreement?

The four basic steps to reaching an agreement on divorce finances are: disclosure, getting advice, negotiating and implementing a Consent Order.

What is a Consent Order and why do we need one?

A Consent Order is a legally binding document that finalises a divorcing couple's agreement on property, pensions and other assets.

Student loan

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solvethis84
Posted by
Senior Member

07 Aug 19 #508944 by solvethis84

Topic started by solvethis84

I’m advised that student loan debts aren’t really counted as proper liabilities for the purposes of financial settlement.

I have a £17,000 student loan, wife doesn’t have one.

After doing all the work for form E it’s given me an opportunity to assess my own finances. As I’m paying quite a high interest rate on my student loan I might pay a proportion of it off with an interest free credit card or even a low interest loan.

Would I be called out/criticised for this by the courts? Would they object to part of the student loan suddenly becoming a credit card debt and relevant to the settlement

hadenoughnow
Moderator

07 Aug 19 #508949 by hadenoughnow

Reply from hadenoughnow

A lot depends on what you are earning and if you are over the threshold for paying it back. Even though the interest rate is quite high, you may find you never actually pay off the loan. You may well find credit card interest rates are a lot higher if you cannot clear it in the interest free period. If you are making student loan repayments, that will reduce your net income.

I would be wary of creating additional debt at this stage, especially if it looks like you have done it to defeat a financial claim.

Hadenoughnow

WYSPECIAL
Moderator

08 Aug 19 #508956 by WYSPECIAL

Reply from WYSPECIAL

The usual advice is that student loans aren't worth repaying early. The majority of people end up with a sum being written off.

It certainly isn't worth borrowing money to repay it.

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Moderators: wikivorce team, rubytuesday, dukey, hadenoughnow, Tets, Shezi, Linda Sheridan, Forseti, Mitchum, WhiteRose, Lostboy67, WYSPECIAL, Bubblegum11

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