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Why am I included on spouses student loans?

Established Contributor

Why am I included on spouses student loans?

I never cosigned, never signed a promissiory note. My wife doesnt work. I pay all the bills including my student loans. So why are they trying to use my income to pay back her loans?

 

On what planet does filing taxes jointly make me liable for her debt? If she isnt working she should be eligible for a 0 dollar payment. Instead they are trying to hit her with a 557 payment


Equifax - 658, Experian -628, Transunion- 704 In the garden until 01/01/2016
Message 1 of 17
16 REPLIES
Community Leader
Legendary Contributor

Re: Why am I included on spouses student loans?

How, specifically, are they trying to use your income to pay her loans?

Are they asking, for example, that you authorize payments from your bank account or to your personal credit card?

Message 2 of 17
Established Contributor

Re: Why am I included on spouses student loans?

They are basically saying to my wife since you aren't working we are going to use your husband's income to calculate your payments because you have access to his money because you filed married filing jointly.

This is asinine

Equifax - 658, Experian -628, Transunion- 704 In the garden until 01/01/2016
Message 3 of 17
Valued Member

Re: Why am I included on spouses student loans?

Spousal income is used when calculating income based repayment.  They are not making you responsible for her loan, they are saying your income is used when calculating this benefit.

Message 4 of 17
Established Contributor

Re: Why am I included on spouses student loans?

Exactly so if she isn't working and they made the payment 500 based on my income. Who do they expect to pay it?
They expect her to pay it with my income.
It all comes back to me.

Equifax - 658, Experian -628, Transunion- 704 In the garden until 01/01/2016
Message 5 of 17
Frequent Contributor

Re: Why am I included on spouses student loans?

If you file your taxes separately as Married, filing Separately then you could use only her 'income.' I presume they reason that since you file jointly that you have joint finances.

 

ETA: They will base her IBR payment on your joint income if/when she starts working again, as well. If you want payments just on her income then you have to file separately.

EX FICO8: Jul 2018 - 572 | EQ FICO8: Jul 2018 - 573 | TU FICO8: Jul 2018 - 578
TCL: $1,450 | AAoA: 7.9 yrs (I can thank my student loans for this) | Util: 82% (high due to charge-offs)
Cleaning up and rebuilding after a long hiatus from credit
Message 6 of 17
Established Contributor

Re: Why am I included on spouses student loans?

That's crazy

 

Its a catch 22. If you file jointly you get all the tax benefits especially if you own a home. If you file separately you dont get those tax benefits.

 

Then if you file jointly they lump you both together on student loan repayment which is just dumb


Equifax - 658, Experian -628, Transunion- 704 In the garden until 01/01/2016
Message 7 of 17
Frequent Contributor

Re: Why am I included on spouses student loans?

I agree. Unfortunately, there's not much in the U.S. system of financing higher education that makes sense.

EX FICO8: Jul 2018 - 572 | EQ FICO8: Jul 2018 - 573 | TU FICO8: Jul 2018 - 578
TCL: $1,450 | AAoA: 7.9 yrs (I can thank my student loans for this) | Util: 82% (high due to charge-offs)
Cleaning up and rebuilding after a long hiatus from credit
Message 8 of 17
Valued Member

Re: Why am I included on spouses student loans?

I'm not sure that's entirety accurate for federal loans.
There are 4 income-driven repayment plans. The REPAY plan is very popular because it takes only 10% of discretionary income but the downside is that if you are married and file jointly you have to use the income for both people.
However, the Income-based repayment plan will take 15% if they borrowed pre- July 1, 2014 and 10% after. It might seem like a "higher" payment but it will only include their income. In fact, the payments will be $0 and and loan forgiveness in 20 years. In your spouses case you'll likely want to upload the application to your loan servicer because the online application will probably keep bumping you back to the IRS site. Sometimes selecting the lowest payment plan option on the income-driven repayment plan application also allows the servicers to just do whatever they want I've found so select a specific plan.
Here is the explanation on the gov website:
https://studentaid.ed.gov/sa/repay-loans/understand/plans/income-driven
Let me know if you have any other questions; I've walked several family members through this overly-complicated process.
Hope this helps!
Message 9 of 17
New Contributor

Re: Why am I included on spouses student loans?

Why would they exclude your income ? You are married . She has debt and she choses not to work, who did you think would pay her debt?  What would happen to the student loan percentage payment program if every person who got married had one partner quit and pay nothing ? 

 

 

775/780/789- EOY 2017
824/812/811- July 2018
Message 10 of 17