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According to Congress.gov, “[n]early 43 million individuals–one in six adult Americans–have federal student loan debt, and the federal student loan portfolio now exceeds $1.6 trillion.” Keep in mind, this doesn’t even account for private student loans, which some estimate to be around $140 billion.

When I saw this, I knew I had to share my thoughts on student loans and how these loans interplay with estate planning. *Just a friendly reminder: there are various types of student loans, and this overview is meant for informational purposes only, not as legal advice.* Let’s dive in!

Are student loans secured or unsecured?

Most student loans are classified as unsecured debt.  This means they are not backed by collateral, such as a house mortgage or a car loan. If you fall behind on payments, lenders cannot automatically seize specific assets. Instead, they use various other collection methods, including lawsuits, wage garnishments, or offsetting your tax refunds.

Some loans may require a cosigner, which provides a sense of security for the lender because they can seek payment from the cosigner if necessary. However, in most cases, your home, car, and bank account are not used as collateral for student loans simply because you have a cosigner, nor does being a cosigner affect this status.

Federal versus private loans

The type of loan is very important. Although this is largely a generalization, the two types of student loans are:

• Federal student loans are backed by the U.S. Department of Education. They come with protections like income-driven repayment and, importantly, discharge at death. If a borrower dies, their federal loans are wiped out once the loan servicer receives a death certificate. Check out studentaid.gov for details.
• Private student loans are issued by banks, credit unions, and online lenders. These loans do not always disappear at death. Some lenders voluntarily cancel the debt, but many will file a claim against the estate or pursue a cosigner. Whether your family is protected depends entirely on the lender’s policy and the contract you signed.

What happens when you die with student loans?

In Ohio, debts must be settled during the probate process before heirs can receive their inheritance. Federal student loans are clear-cut; they are discharged and do not affect the estate. However, private loans are more complex. If the lender does not cancel the loan, they may present a claim during probate, and the executor must address it.

If the estate does not have enough assets to cover all debts, Ohio law establishes a priority order for creditor claims. Importantly, heirs do not inherit debt unless they cosigned the loan or have a legal obligation to pay it.

What about marriage and divorce?

Getting married does not automatically make you responsible for your spouse’s student loans in Ohio. If your spouse took out loans in their own name, those loans remain their individual responsibility. The main exceptions to this rule are:

• If you cosigned the loan, you are legally responsible for it.
• If you refinance or consolidate loans together during the marriage, you may become jointly responsible for repayment.

When it comes to divorce, Ohio courts decide how debts are divided. Generally:

• Loans taken out before the marriage are usually treated as the separate debt of the spouse who borrowed them.
• Loans taken out during the marriage may be considered marital debt, especially if the money benefited both spouses (for example, if loan funds helped pay living expenses). In that case, the court may divide the responsibility between the spouses as part of the property division process.
• The exact outcome depends on the circumstances and the judge’s determination of what is equitable.

This makes it especially important to keep records of when student loans were taken out and how the funds were used, since that can affect how the debt is treated if the marriage ends.

Can the government come after your estate?

For federal loans, the answer is no. These loans are discharged upon death by the Department of Education. This means the estate is not responsible for repayment, and heirs will not be burdened with the debt.

For private loans, if the contract does not include a cancellation provision, the lender may file a claim against the estate. This means that the assets passing through probate could be reduced before the heirs receive their share. However, non-probate assets, such as retirement accounts with designated beneficiaries or property held in a trust, can sometimes be protected from these claims.

Planning tips for borrowers in Ohio

• Know what you have. Make a list of all your student loans, their type, and whether a cosigner is involved.
• Do not refinance lightly. Moving a federal loan into private status means losing the death discharge and other protections.
• Consider life insurance. A term policy can ensure your family has resources to pay off private loans if needed.
• Use estate planning tools. Assets held in a trust or passed by beneficiary designation may avoid probate and reduce exposure to creditor claims.
• Communicate with your executor. Leave clear instructions and documentation so they know how to request federal loan discharge or handle private loan claims.

Final thoughts

Student loan debt is part of life for many Ohio families, but it does not have to derail your estate plan. Federal loans end at death, but private loans may linger and affect your estate. With careful planning though, through insurance, proper titling of assets, and clear documentation, you can minimize the impact on your loved ones.