During a divorce, many topics are covered in the Marital Settlement Agreement, and many more when the divorcing couple have children together. This can include child support as well as future college contributions. Depending on the agreement, the divorcing parties may specifically determine the percentages that each will pay for college costs, or will—if the child or children are young—defer setting any percentages until the child is in their senior year of high school. Within these agreements, there is often language that stipulates the children are required to apply for any available financial aid, grants and/or loans. However, does this mean children must be forced to take out loans for an obligation that is intended to part of their parents’ obligation?
A recent New Jersey Appellate Division opinion tackled this complicated question in the matter of M.F.W. v. G.O. In the case, the parties divorced in 2003 when their daughter was 5 years old, and their settlement included an agreement to pay for college and included language requiring that the daughter “…shall apply for all loans, grants, aid and scholarships available to her, the proceeds of which shall be first applied to college costs.”