Utah Debt Relief

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 its famed pastrami burgers. Utah’s business climate is also friendly, enticing investors, corporations, and small business owners.

But as residents try to take advantage of the positive economic situation, some find themselves struggling with medical debt, auto loan debt, mortgage debt, and especially credit card debt.

If you are struggling with debt in Utah, the following information and stats can help you. In this article, we take a deep dive into debt relief options and provide advice on how to achieve a debt-free life by enrolling in a tailored program like TurboDebt's.

Utah: Economic Picture

The unemployment rate in Utah is low at 2.3% as of April 2023. This may be due to the increase in job opportunities in the housing sector, where high demand for houses has brought home values up.

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 debts. Some of the most impactful debt relief solutions for Utah residents involve negotiating for lower interest rates, reduced monthly payments, and eliminating high-interest credit card fees.

Debt and Finance Statistics Specific to the State

The following are some of the most noteworthy debt and finance statistics in Utah related to secured and unsecured debt:

Average Consumer Debt

The average consumer debt in Utah is $63,954, with student loans and mortgage payments accounting for more than 50% of average consumer debt in the Beehive State. Credit card debt saw an increase of 3 percentage points coupled with an upward trend 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 in 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

Utah's average auto loan debt increased to $21,560 for first-time buyers in 2021, sitting above the national average of $20,987. 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.

Utahans pay an average auto loan debt of $5,710 and an average monthly payment of $477.

Mortgage Debt

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

Over 300,000 college grads in Utah carry student debt, with an average federal student loan debt of $32,760. This positions Utah among the states with the least number of residents with student loans. The state of Utah ranks 42nd in student debt, with a total student debt loan of $9.9 billion.

Household Debt

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.

Bankruptcy

The Beehive State has been recording a downtrend trend in the total number of filed bankruptcy cases for the past decade. In 2022, the total number of filed bankruptcy cases was 5,128 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 as a whole has a median household income of $79,133 and a per capita income of $33,378.

The unemployment rate in Utah was 2.3% in April 2023, 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 a labor participation rate of 69.0.

Credit Scores

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 historically low unemployment rates that ensured Utah residents managed their monthly payments, thus increasing their credit scores.

Identity Theft

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 8th best for the 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.

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, with assets totaling $934,832 million. Salt Lake City has the highest deposits of $804,240 million, but the banking sector in the state receives a huge boost from industrial banks. The Beehive State accounts for 93.5% of the nation’s industrial banks holding $140.6 billion in assets as of 2019.

How TurboDebt Helped Utah with Debt Relief This Past Year

TurboDebt worked with 926 Utah residents in 2022, helping deliver the best debt relief solutions. In 2022, we enrolled 334 clients in our debt relief program. The average enrolled client 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 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. This kind of debt can be hard to overcome because of compounding late payments and high interest fees that make it difficult to pay off the principal amount. If you only make the minimum payment, you'll take longer to pay off your total, adding interest to your debt each month.

Revolving debt and high-interest rates create credit card debt. The good news is that there are several key ways to tackle this debt. TurboDebt offers debt settlement options to help you eliminate part of your debt after we negotiate with your lenders.

Divorce Debt

Divorce in Utah comes with varied costs and a pay structure based on the spouse holding the debt. For example, you won't be linked to your ex-spouse's personal loans 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. This results in residents of Utah owing divorce debt, which many are 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.

Business 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.

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.

Let TurboDebt help you manage your outstanding business debts. We offer consulting, advising, and strategic planning, along with our customized debt relief programs to get your business back on track.

Medical Debt

Many people in Utah struggle to pay medical bills. In fact, 13.4% of residents had medical bills in collections as of December 2020, according to the Consumer Financial Protection Bureau. Outstanding medical bills totaled over $1 billion.

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 balance, even up to 50% before fees.

Homeowner Debt

The prices of homes in Utah have increased due to the shortages of houses in the state and increased demand. Housing shortages have only worsened because of the pandemic since 30% of building materials come from China, and imports were disrupted for months.

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 amid rising interest rates for mortgages.

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.

Retirement 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.

However, living on a fixed income in the Beehive State comes with challenges. Paying off unexpected costs while living on a pension and retirement savings can make even the smallest bills daunting. Let TurboDebt help you overcome retirement debt, so you can live comfortably with the wealth you've built.

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 to pursue in Utah:

Debt Management Programs

Debt management programs (DMPs) help debtors create a monthly payment plan to tackle outstanding balances. This can involve lowering interest rates on credit cards or creating a plan to make low monthly payments toward your debts.

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.

Keep in mind that debtors seeking debt relief help through DMPs can face missed payment penalties and take 3 to 5 years to complete the program.

Debt Consolidation Loans

Debt consolidation loans are loans that debtors take to offset existing loans. Utah residents with an average FICO score of 730 are more likely to access low-interest loans. 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

Debt settlement works when creditors and borrowers agree on a partial lump sum payment on debt and eliminate the rest of the loan balance. This option can be effective for residents facing tough financial situations like changes in employment that are affecting their ability to make consistent monthly payments.

Debt settlement can reduce your payment by as much as 50%. In this type of program, it's also possible to pay off your debt in as little as 24 months. When pursuing debt settlement companies, be aware of scammers who request upfront fees. Find a reputable, accredited business through the better business bureau or look up reviews from a trusted source.

Credit Counseling

Credit counseling agencies advise you on budgeting and debt management, providing free workshops and educational materials on financial principles. They’ll also assist you in acquiring credit card reports and choosing a debt management program based on your debt-to-income ratio.

Credit counselors can also help you understand your credit report, providing strategies to avoid debt in the future. Although they can help you make a debt management plan, credit counseling agencies don't make payments on your behalf unless they're linked to a debt management program.

Bankruptcy

Filing for bankruptcy is often the last choice for individuals in debt. Bankruptcy impacts your credit report for 7 to 10 years, thus limiting your access to personal loans. It's also a process that takes time and help from a legal professional.

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 to reorganize their payments to debt collectors. Consider pursuing advice from a law firm on the best type of bankruptcy to file as an individual or business entity.

Debt Forgiveness

In debt forgiveness, creditors cancel some or all of your debt balances. This type of debt relief is uncommon and requires those in debt to meet specific requirements that prove ongoing financial hardship. You can also qualify for debt forgiveness programs through certain jobs like public service.

It's also important to note that your forgiven debt must be filed with the IRS as income tax to avoid the accumulation of tax debt.

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 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, employment opportunities, and child support. You can access the program for up to three years during your lifetime.

The Utah Unemployment Insurance offers compensation for residents who are actively looking for work but can’t find employment. You must have worked in Utah in the past 12 months or longer to qualify for assistance.

The 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 provide for their kids through comprehensive medical, social, and educational services. You’re also eligible for the program if you have a child who’s below 19 years. Utah Medicaid also assists low-income disabled residents or families in accessing health insurance.

Utah SNAP is a relief program for low-income households facing food insecurity. Residents are eligible for benefits with a maximum account balance of $2,500 or $3,500 if they’re living with a disabled family member or the elderly.

Utah's HEAT Program assists low-income and vulnerable communities with heating utility bills, especially during winter.

Child Care

Utah’s Children’s Health Insurance Program offers medical aid to uninsured children under the age of 19. The program focuses on preventive care and is run by the Utah Department of Health.

Utah's Special Supplemental Nutrition Program for WIC delivers top-notch nutrition and breastfeeding knowledge to families in Utah, while the Special Milk Program provides milk to low-income children who don’t benefit from other food programs.

Summer Food Service Program ensures that low-income children receive quality food when schools are closed.

Shelters for the Homeless

You can access 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 undergoing traditional medical services can receive refunds on non-emergency medical transportation.

You can also receive transportation services using the UTA transit card. To qualify for the card, your area must offer UTA services, and you must have traditional Medicaid. You can then use the card for medical appointments.

Other free medical appointment transportation services include Para-Transit Bus Services and ModivCare Services.

Finding Debt Relief in Utah

Utah residents continue to experience debt burdens due to high mortgage prices, rising interest rates, inflation, and high-interest credit card payments. This has led to a drop in consumer spending as disposable income is directed toward debt management.

However, Utahans seeking debt relief options can get help from a reputable debt management company like TurboDebt. Last year, we provided debt relief options that reduced debt balances by more than 50% on average before fees.

Start planning for a debt-free life and take advantage of our free debt relief consultation today!