Utah Debt Relief
20 MIN READ
Published April 03, 2023 | Updated May 04, 2023
In a Nutshell
The Beehive state receives a high influx of people thanks to its good job market, financial stability, attractive landscapes, Sundance Film Festival, and even pastrami burgers. Utah’s business climate is also friendly ensuring that investors are inbound.
But as residents try to take advantage of the good economic situation, some find themselves struggling with debt. This could be a result of failed business ventures leading to business debt or other types of debt, including medical debt, auto loan debt, mortgage debt, and many more.
If you are struggling with debt in Utah, this post is for you. We dive into all things surrounding debt relief in Utah, including the types of debt relief options, financial hardship resources, and how to achieve a debt-free life by enrolling in a tailored program like ours.
Utah: Economic Picture
The unemployment rate in Utah is low at 2.4%. This is due to the increase in job opportunities in the housing sector, where high demand for houses has brought home values up to an average home value of $495,920.
The industrial banking sector has also contributed to the healthy economic condition in Utah as it employs 0.3% of Utah’s labor force and contributes 0.4% of the state’s GDP.
How does debt relief work in Utah?
Debt relief in Utah refers to a variety of programs and services that are available to assist individuals and businesses in managing their debt. Some of the most impactful Utah debt relief solutions work by negotiating for lower interest rates, low monthly payments, debt cancellation, or a waiver on late payment fees to eliminate high-interest credit card debt, secured debt, and unsecured debt.
Debt and finance statistics specific to the state
The following are some of the most noteworthy debt and finance statistics in Utah:
Average consumer debt
The average consumer debt in Utah is $63,954. Student debt loans and mortgage payments accounted for more than 50% of average consumer debt in the state of Utah. Credit card debt saw an increase of 3 percentage points with the increase in credit card utilization rates.
Credit card debt
Utah residents owe an average credit card debt of $5,225 against the national average of $5,910 as of 2022.
The recent increase in credit card debt is largely due to the hiking of interest rates, which increased APRs nationally by around three percentage points on some credit cards. Also, the credit card utilization rate in the US grew by two percentage basis points to 28, leading to an increase in credit card debt as consumer spending on cards increased. At TurboDebt, this remains the most significant form of debt that we enroll in our program.
Auto loan debt
On average, households in Utah own two cars, and 74.4% of workers drive by themselves to work, while 10.4% carpool. This increased the average auto loan debt owed to $21,560 for first-time buyers in 2020, which is above the national average of $20,987. Utahans are expected to pay an average auto loan debt of $5,710 and an average monthly payment of $477.
One of the contributors to the increase in car loan debt in Utah was supply chain constraints which resulted in the high demand for cars. This was evident after the pandemic when residents experienced high car prices.
The homeownership rate in Utah is 70.5%, with home values over $400,000. The monthly median mortgage payment in the state is $1,682, and the monthly median gross rent is $1,171. Although the severe housing rate problem dropped to 1.57 from 13.6, Utah still faces a housing shortage that is driving home prices up, resulting in mortgage debt.
Student loan debt
The state of Utah ranks 42nd in student debt, with a total student debt loan of $9.9 billion.
Over 300,000 college grads carry student debt, with an average federal student loan debt of $32,760. This position Utah among the states with the least number of residents with student debt loans.
Household debts in America increased by $394 billion in Q4 of 2022, largely due to an increase in mortgage balances of nearly $1 trillion in 2022. This increased the debt-to-income ratio of Utahans to 1.831, resulting in an average increase in household debt to $132,055 from $122,474.
The Beehive State has been recording a downtrend trend in the total number of filed bankruptcy cases for the past decade. The total number of filed bankruptcy cases was 5,128 in 2022 compared to the previous year’s 5,576. Chapter 7 bankruptcy cases were leading at 3,054, followed by Chapter 13 bankruptcy cases at 2,053, then Chapter 11 bankruptcies at 20 cases, and other bankruptcies at 1 case.
Average income and employment
8.55% of Utah households are high-income households, with Park City having the highest average household income of $219,215. The state has an average household income of $101,412, a median household income of $79,133, and a per capita income of $33,378.
The unemployment rate in Utah was 2.4 in Q4 of 2022, as residents participated in up-skilling activities to increase their value due to the high demand for skilled labor. The increase in demand for skilled labor has led to an increase in the labor participation rate of 69.0.
The national average credit score remained unchanged at 714 due to tough financial situations that saw consumers struggling with debt management.
In Utah, the average credit score increased to 730 in 2022 from 727 in 2021; this can be attributed to the pre-historic low unemployment rates that ensured Utah residents manage their monthly payments on debt, thus increasing their credit scores.
Utah ranks 20th in identity theft, with 4,702 reported cases. However, in fraud and other cases, the state ranks 31st with 17,228 fraud cases and a median fraud loss of $300.
The leading types of identity theft in the state include the following;
- Other identity theft at 42%
- Credit card fraud at 41%
- Loan or lease fraud at 25%
- Phone number or utility fraud at 11%
- Bank fraud at 9%
Banking and tax info
The top individual and corporate tax rates in Utah are equal at 4.85%, making the state have the 8th best state business tax climate. The individual state and local tax burden of Utah is 9.6%.
The state’s sales tax rate is 6.10%, and the average local sales tax rate is 1.09%. Residents of Utah also pay a state sales tax rate of about $0.32 cents per gallon of gasoline and $1.70 per 20 packs of cigarettes. Tax-exempted products in Utah include machinery and medical devices, with groceries, including soda and candy, receiving the lowest sales tax rate of 3%.
The property tax rate in Utah is 0.57% of the home value, and there’s a per capita state and local property tax collection fee of $1,209.
41 banking institutions are located in Utah, and they have total assets of $934,832 million, with Salt Lake City having the highest deposits of $804,240 million. But the banking sector in the state receives a huge boost from industrial banks.
The state has 93.5% of the nation’s industrial banks that account for $140.6 billion in assets as of 2019. These industrial banks contribute to 0.3% of Utah’s employment and 0.4% of the state’s GDP.
How TurboDebt Helped Utah with Debt Relief This Past Year
TurboDebt is a debt relief company that worked with 926 residents of Utah in 2022 to help deliver the best debt relief solutions. In 2022, we enrolled 334 clients in our debt relief program. The average client enrolled debt was $19,920, and the total enrolled debt was $6,658,431. Out of the total enrolled debt, we saved our clients 56.96% on average before fees, bringing the total debt saved to $3,792,642.
Top Types of Debt to get Relief from in Utah
TurboDebt’s debt relief program offers debt relief solutions for the following top types of debt in Utah;
Credit Card Debt
Utah residents have an average credit card debt of $5,225, which takes time to clear. This is because credit card debt has a compounding effect on late payments and still results in interest fees that are high compared to the principal amount if you’re only making the required monthly payments.
As such, this revolving debt and high-interest rates present credit card debt problems. The good news is that there are several key ways to tackle this debt. For example, a debt consolidation plan can help you clear credit card debt through a single monthly payment at a reduced interest rate. This greatly reduces the risk of accumulating as many interest fees or late repayment penalty fees.
In Utah, you cannot accumulate divorce debt from personal loans benefiting one individual unless you agree to assist in the repayment of the debt. Also, if the divorce debt is arising from an item, for example, a car loan debt, the person who gets to keep the car is liable for the debt payment.
However, the state shares divorce debt, either equally or depending on the court’s judgment, of jointly owned debts between spouses or if it was used for the benefit of the marriage. This results in residents of Utah owing divorce debt, which most were unprepared to handle.
At TurboDebt, we’re passionate about eliminating your divorce debt, and it all starts with a simple debt consultation. We can even connect you with other credit counselors who can offer you advice on budgeting, debt, and money management to help you clear your divorce debt.
Utah has a corporate tax rate of 4.85%, making it one of the best states to run a business in America. However, not all businesses are flourishing in Utah, as seen by the recent increase of Chapter 11 bankruptcy cases to 20 cases in 2022, up from 8 cases in 2021, increasing business debt.
Such a sharp increase in business debt may result in unfair debt collection, including harassment, forceful change of business ownership, or repossession of your business assets because business debt isn’t regulated by the FDCPA.
Utahns have around 13% of medical debt in collection and can inherit their deceased spouse's medical debt. In addition, 8.9% of its population and 82,000 kids are also uninsured, leading to losses of more than $9 million in medical bills.
Such a financial situation makes access to medical care difficult and expensive considering that the average cost of health insurance is $4,840.
At TurboDebt, we can help you navigate through medical debt with a debt settlement plan. Debt settlement plans will assist you in clearing off some percentage of your medical debt and forgiving the medical debt balance.
The prices of homes in Utah have increased due to the shortages of houses in the state and increased demand. The house shortages have been made worse by the pandemic since it disrupted the importation of 30% of building materials from China.
Such financial situations led to the increase in home prices, hence, outpricing household incomes in Utah. This has led to the accumulation of homeowner debt in a move aimed at avoiding homelessness.
TurboDebt’s tailored debt relief programs are here to assist you in tackling homeowner debt and avoiding foreclosure on your property. You can take advantage of our free consultation now to learn what options will be best to help you work towards a life free of homeowner debt.
Utah residents enjoy an average cost of living that’s 4.7% less than the national average, making the state ideal for retirement. What cements this reality is that the state can finance its liabilities, including unpaid pension benefits of $411 million in 2022.
Debt relief options in Utah
Your eligibility for different debt relief options depends on various factors, including credit scores and the types of debt you owe creditors. The following are debt relief options you can qualify for in Utah;
Debt management programs
Debt management programs work on unsecured debt by lowering interest rates on credit card debt or coming up with low monthly payments. DMPs are delivered by nonprofit credit counseling agencies, which won’t consider your credit score.
As a debt relief option, you’ll be required to close your existing credit cards to avoid accumulating more debt and make consistent monthly payments to a savings account. Creditors will then be paid from the savings account by the nonprofit credit counseling agency.
Debtors seeking DMPs in debt relief must be cautious of the missed payment penalty and the 3 to 5 years it takes to complete the program.
Debt consolidation loans
Debt consolidation loans are loans that debtors take to offset existing loans. With an average FICO score of 730, Utah residents’ accessibility to low-interest loans is guaranteed. These low-interest loans save you money by clearing off high-interest loans and lowering monthly payments.
You may be asked for your employment status and letters from creditors to qualify for a debt consolidation loan. Examples of debt consolidation loans include balance transfers, personal loans, and home equity loans.
Debt consolidation loans increase your credit utilization ratio and improve your credit score over time.
Debt settlement works when creditors and borrowers agree on a partial lump sum payment on debt and forgive the loan balance. It’s best suited for residents facing tough financial situations like changes in employment that are affecting their ability to make consistent monthly payments.
Debt settlement can achieve a 50% debt cancellation resulting in a negative impact on your credit score. When pursuing debt settlement companies, you must be aware of scammers who request upfront fees. You can look them up through the better business bureau to verify eligibility.
Credit counseling agencies advise you on money and debt management and budgeting and provide free workshops and educational materials. They’ll also assist you in acquiring credit card reports and choosing a debt management program based on your debt-to-income ratio.
Credit counseling works by negotiating for lowered interest rates, waiver of late penalty payments, and low monthly payments. You must ensure that you’re working with a certified credit counseling agency to avoid creditors refusing your debt management plan. You can confirm their credentials through the better business bureau.
The last resort of debt relief among debtors is filing for bankruptcy. Filing for bankruptcy impacts your credit report for 7 to 10 years, thus limiting your access to personal loans.
Chapter 7 and 13 bankruptcy cases are for Utahans in a tight financial situation. In chapter 7, non-exempt properties are liquidated for debt settlement, while in chapter 13, you’re required to make monthly payments lasting 3 to 5 years instead of liquidating your assets.
Businesses in Utah can file for a chapter 11 bankruptcy case for a reorganization of their debt settlement plan with debt collectors. You should consult for legal advice from your law firm on the best type of bankruptcy to file for individuals.
Debt forgiveness works by canceling or forgiving part or full debt balances by creditors. This debt relief option is for borrowers who have lagged on debt payments and are struggling to meet their basic requirements.
Your forgiven debt must be filed with the IRS as income tax to avoid the accumulation of tax debt. There must be a debt forgiveness program for you to qualify for debt forgiveness, for instance, the federal student debt loan forgiveness program.
Debt and Financial Hardship Resources
Utah residents experiencing financial hardships and low-income families can access state help in meeting their basic requirements through the following available debt and financial hardship resources;
Temporary assistance programs
The Utah Family Employment Program is a TANF program that seeks to help pregnant mothers and parents who are unemployed or underemployed access cash assistance, job training and employment opportunities, and child support. The program lasts for three years in a lifetime, and you must fill in 30 hours of work-related activities or 20 hours if your kid is less than six years old.
The Utah Unemployment Insurance offers compensation for residents who are actively looking for work but can’t find employment. You must have a minimum wage as outlined by the program and have worked in Utah in the past 12 months or longer.
Utah Weatherization Assistance Program helps the elderly, families with disabled members and kids, and people receiving TANF and Supplemental Security Income (SSI) cut their energy consumption in a move to improve self-efficiency.
State health and human services
The Family Planning Service assists pregnant low or very low-income families in determining how they can space their kids through comprehensive medical, social, and educational services. You’re also eligible for the program if you have a kid who’s below 19 years.
Utah Medicaid assists low-income disabled residents or families in accessing health insurance.
Utah SNAP is a food relief program for low-income households that may face starvation. The program is eligible for residents with a maximum account balance of $2,500 or 3,500 if they’re living with a disabled family member or the elderly.
Utah HEAT Program assists low-income and vulnerable communities with heating utility bills, especially during winter.
Utah’s Children’s Health Insurance Program offers medical aid to uninsured children under the age of 19 years. The program focuses on preventive care and is run by the Utah Department of Health.
Utah Special Supplemental Nutrition Program for WIC delivers top-notch nutrition and breastfeeding knowledge to families in Utah.
Summer Food Service Program ensures that low-income children receive quality food when schools are closed.
Special Milk Program provides milk to low-income children who don’t benefit from other food programs.
Shelters for the homeless
You can access home shelters if you’re experiencing homelessness in Utah. Remember to call in advance and confirm the availability of a bed before going to the shelter, as some of them have high demand.
Free transportation services
Utahans with traditional medical services can receive refunds on non-emergency medical transportation. You can also receive transportation services using the following options;
UTA transit card- your area must be receiving UTA services, and you must have traditional Medicaid to qualify for this card. The card is only used for medical appointments.
Other free medical appointment transportation services include Para-Transit Bus Services and ModivCare Services.
Conclusion on Finding Debt Relief in Utah
Utah residents experienced debt burdens due to the high mortgage prices in the state and high-interest credit card loans. This has led to a drop in consumer spending as disposable income is directed toward debt management.
However, Utahans seeking debt relief options must get help from a reputable debt management company. You can confirm their credibility through the better business bureau to avoid scams.
TurboDebt is a reputable company that delivered debt relief options that reduced debt balances by more than 50% on average before fees last year.
Take advantage of our free debt relief consultation now!