When your spouse has debt

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Getting married to a person with student loan or any other kind of debt can complicate things.

By Beth Newcomb

Getting married to a person with student loan or any other kind of debt can complicate things. Sometimes, because one partner is a little too far into the red, the other spouse is the only one who can be on a mortgage and is therefore the only one to hold title to the house, says Jay Nabors, a Cleveland-based attorney who focuses on estate planning.

“I had a situation recently with this same scenario,” Jay says. “The wife had too much student loan debt and couldn’t be on the mortgage, so that and the title to the house was in her husband’s name. Unfortunately, he passed away at a young age.”

The house, Jay says, doesn’t automatically go to the surviving spouse if one dies. “This is why it’s important to have a Transfer on Death affidavit,” Jay shares. “If one spouse passes, the house automatically transfers to the surviving spouse, even if he or she has student loans, and it doesn’t have to go through probate.”

In the case of this person, she inherited her husband’s 401k plan and got life insurance, so when she contacted the lender she was in a different financial position. Not everyone is so fortunate.

“It’s imperative that in any situation where one spouse is on the loan and the other isn’t that a Transfer on Death affidavit be implemented. It avoids probate, additional costs and headaches,” Jay notes.

Jay is a partner with Weston Hurd LLP. Typically he sees clients at the firm’s office in downtown Cleveland, in addition to meeting with clients in Strongsville upon request. Virtual meetings, house calls and select evening appointments are available.

To reach Jay Nabors of Weston Hurd LLP, call 216-687-3205. His office is at 1300 E. 9th Street, Suite 1400 in Cleveland. Jay can also meet clients at 11221 Pearl Road in Strongsville.