Can You Consolidate Your Spouse’s Student Loans With Yours?

You can consolidate your spouse's student loans with your student loans by refinancing with a private lender. But it's not always the best financial move.

If you're considering consolidating student loans with your spouse, here's how to decide if you should.

Refinancing together could save you money

Refinancing student loans with your spouse can help you save money on higher-interest private and graduate school loans.

For example, by refinancing a $60,000 loan from 7% interest to 5%, you’d save roughly $7,200 over a 10-year term.

Typically, you’ll need robust finances and a good credit score to qualify and get the best rate.

Spouses may increase their chances at getting a better rate together, says Andrew Zoeller, vice president for Purefy, which refinances loans for Pentagon Federal Credit Union, or PenFed.

For joint spousal loans and loans that spouses co-sign, PenFed evaluates the couple based on their combined income and counts shared debts, like mortgages, only once. This allows more individuals — such as stay-at-home parents with good credit — to meet PenFed’s lending criteria. Other lenders may evaluate spouses separately; ask a lender about its policy before applying.

Though refinancing federal student loans could lower your monthly payments, you'll forfeit important perks like access to income-driven repayment (IDR) programs that can also lower payments, Public Servicer Loan Forgiveness, a one-time IDR account adjustment that could forgive debt entirely for longtime borrowers by the end of 2023 — and much more.

» MORE: What happens to student loans when you get married?

Refinancing could make divorce messier

If you co-sign a refinancing loan or combine debts with your spouse, you’re equally responsible for repaying the balance — even after a divorce.

For example, a divorce decree could outline who’s responsible for repayment, but both names remain legally on the debt. That means if one spouse doesn’t pay, the other still suffers the consequences of missed payments, like damaged credit and collection calls.

Divorcees could refinance the loan or portions of it into their individual names to get around this, but only by meeting a lender’s income and credit qualifications on their own.

» MORE: Student loans in divorce: What happens to the debt?

Should you say 'I do' to joint refinancing?

Still have cold feet about refinancing with your spouse? These steps may help protect you:

• Try co-signing first. Co-signing may have a valuable option that spousal loans lack: programs that eventually remove your spouse from the loan. Co-signer release policies vary by lender; PenFed, for example, doesn’t release spouse co-signers.

• Get extra life insurance. Cover yourself if your partner dies and you have to pay a hefty spousal loan on your own. You may owe the balance on a co-signed loan as well, depending on a lender’s policies.

• Know what you're giving up. Once you refinance loans, you can’t get your original loans back. If you want or need federal loan benefits, like alternate repayment plans and forgiveness programs, don’t refinance them.