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How to Get Debt Relief in Utah

Dena Standley | October 19, 2022

Dena Standley
Legal Expert, Paralegal
Dena Standley, BA

Dena Standley is a seasoned paralegal with more than 20 years of experience in legal research and writing, having received a certification as a Legal Assistant/Paralegal from Southern Technical College.

Edited by Hannah Locklear

Hannah Locklear
Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

SoloSuit is on its way to rescue you from debt

Summary: If you're struggling with debt in Utah, SoloSuit can help you find the relief you need.

If you've missed a few payments on credit, such as a car or personal loan, the bank can put your debt into collections. After that, a collection agency or a lawyer will try to collect the money you owe the loan provider. Debt collection is a serious process that can adversely affect your credit score.

Creditors and debt collectors may pressure you to follow a specific debt-reduction strategy that benefits them but may or may not be in your best interests. Before you make any decisions on paying off debt, you should understand all your options, including the risks and benefits.

Debt relief options

Paying off a debt appears to be an impossible goal. You can't even afford to make the minimum monthly payments right now, let alone incur a debt in the amount you owe. Don't become disheartened if you are currently in debt.

You can take steps to make your debt more manageable because there are solutions that can assist you in permanently eliminating your debt. The following are five debt relief methods that others in Utah have used to clear their names.

1. Pay the bare minimum each month

Late or missed payments can destroy your credit score quickly. Paying the minimum monthly payment on all debts will help keep your credit score from plummeting and buy you time to develop a plan for debt relief. While paying the minimum on all credit cards, choose the highest interest card and pay above the minimum as much as your budget will allow. Once that card is paid off, roll that entire payment to the card with the next highest interest rate. This is known as the avalanche or snowball method of repayment and will help you get out of debt while protecting your credit score.

2. Debt settlement or negotiation can help

Debt settlement is a unique type of debt relief because it not only works to lower interest rates on unsecured loans but it can also lower the entire debt balance through negotiation.

Consolidation and counseling, on the other hand, merely reduce the amount of interest owed. Compared to debt consolidation or debt counseling, debt settlement can be a faster and less expensive choice because the principal balance is substantially lower.

You can negotiate a settlement by yourself, or you can hire a debt settlement company to help you out. These companies are experts in negotiation, and they know what to say to reduce the amount you owe the creditor or debt collector. In fact, they may be able to help you reach a settlement of 1%-70% of the original amount you owed.

This option saves you money, and it takes away the stress of dealing with creditors and debt collectors.

3. Find debt management programs or Utah credit counseling

Credit counseling and debt management are both available for free in Utah. These programs usually allow you to make one payment to a credit counseling service, which then distributes the funds to your creditors on your behalf.

While the debt management company may be able to negotiate lower interest rates with your creditors, you will still be responsible for repaying the total loan principal and any accrued interest. These programs have a poor completion rate in Utah and are usually meant to take three to five years to finish.

4. Consider debt consolidation

Debt consolidation is a type of debt relief in which you take out a larger loan with a low-interest rate and use the money to pay off other unsecured debts with higher rates.

This can result in a single, reduced monthly payment of less than the entire amount owed previously. Still, consolidation loans can be difficult to qualify for and have a high-interest rate if the debt is not returned within the promotional period.

5. File for bankruptcy as a last resort

Consumers in Utah who cannot satisfy their financial obligations and whose creditors are no longer prepared to discuss a settlement may face bankruptcy. Declaring bankruptcy formally halts creditor collection efforts, and depending on the kind of bankruptcy filed, the debtor is relieved of some or all of their unsecured debt.

Utilize these Utah debt relief programs

  • Homeless Prevention Program: Provides cash assistance to cover the costs of rent, security deposits, mortgage, and utilities for Utahns who have had their housing threatened.
  • Family Employment Program: Offers temporary cash assistance for families, which can add up to 36 months of financial support to a family within a lifetime.
  • General Assistance: Provides time limited cash assistance and case management services to single adults and married couples with no dependents living in their households. Participants must verify a physical or mental health impairment that prevents basic work activities in any occupation, lasting 60 days or longer from the date of application.
  • Kids In Care: Offers child care assistance for eligible parents to support formal job search activities.
  • Supplemental Nutrition Assistance Program (SNAP): Offers nutrition assistance to buy healthy food.
  • ABLE Program: Allows individuals with disabilities to save and invest without losing benefits such as Medicaid or SSI.
  • Private Student Loan Relief: Provides a network of financial counselors who link troubled families with trustworthy agencies for financial assistance with private student loans.

Know your rights when dealing with debt collectors

It's important to understand that you have rights while dealing with debt collectors. Debt collectors are prohibited from using abusive, unfair, or deceptive tactics to collect debts under the Fair Debt Collection Practices Act (FDCPA).

You may be able to bargain with the lender if the Debt Validation Letter reveals a legitimate debt in your name. You can pay less than the whole amount due or set up a payment plan. Alternatively, you might go to court and plead your case.

Debt collectors are not allowed to contact you before 8 a.m. or after 9 p.m. unless you agree. They can't phone you at work if you've told them you're not allowed to receive calls. They are prohibited from disclosing information about your debt to anybody other than you, your spouse, or an attorney if you choose to hire one.

They can't additionally use filthy language, threaten you with violence, or falsely claim legal action against you. Contact the Utah State Attorney General's Office, the Federal Trade Commission, or the Consumer Financial Protection Bureau if a debt collector breaches your rights. Their official contact information is:

Utah State Attorney General's Office

Phone Number: 1-801-366-0260


Address:

Office of the Attorney General

Utah State Capitol Complex

350 North State Street Suite 230

SLC UT 84114-2320


Utah State Capitol Office Mailing Address

Office of the Attorney General

PO Box 142320

SLC UT 84114-2320


Heber M. Wells Building Mailing Address

P.O. Box 140811

Salt Lake City, UT 84114


Consumer Financial Protection Bureau

Phone Number: 202-435-7000.


Address:

1700 G Street NW.,

Washington, DC 20552.


Utah debt collection laws can protect you

Like the FDCPA, Utah has specific state laws that protect consumers from unfair debt collection practices. It's critical to know your state's statute of limitations if you're in debt. This refers to the amount of time a creditor has to sue a borrower to recover money owing to them when it comes to debt. Creditors cannot sue you for the debt once the statute of limitations has expired.

Before you start making any payments to a debt collector, which restarts the clock on the statute of limitations, be sure to check the statutes of limitations on different types of debt in Utah:


Utah Statute of Limitations
on Debt

Debt Type

Deadline in Years

Written

6

Verbal

4

Open Accounts

4


Source: Findlaw

As a reminder, if you believe a debt collector is contacting you about a debt that has passed its statute of limitations, don't make a payment or agree to a payment plan because doing so will reset the clock on your obligation.

Instead, inquire as to whether the loan has run out of time. The lender must provide you with accurate information. If they cannot respond, speak with an attorney or a non-profit credit counseling agency about your options.

Responding to letters of demand

It's a good idea to get a Debt Validation Letter if you receive a notice from a debt collector. A Debt Validation Letter explains what you owe and who you owe it to and confirms that you are legally obligated to pay the amount.

Check to see if the information is correct. They may send you a notice of error in some situations. If this is the case, write a cease and desist letter to the lender, telling them to stop contacting you.

What if I've been sued for a debt in Utah?

Sued for a debt? Solosuit can assist you with responding to debt collectors' lawsuits and assist you in taking a stand and winning your case. We know how Utah's debt laws work and how they apply to you in your current position.

To learn more about how to respond to a debt lawsuit in Utah, check out this video:

What is SoloSuit?

SoloSuit makes it easy to fight debt collectors.

You can use SoloSuit to respond to a debt lawsuit, to send letters to collectors, and even to settle a debt.

SoloSuit's Answer service is a step-by-step web-app that asks you all the necessary questions to complete your Answer. Upon completion, we'll have an attorney review your document and we'll file it for you.

Respond with SoloSuit

"First time getting sued by a debt collector and I was searching all over YouTube and ran across SoloSuit, so I decided to buy their services with their attorney reviewed documentation which cost extra but it was well worth it! SoloSuit sent the documentation to the parties and to the court which saved me time from having to go to court and in a few weeks the case got dismissed!" – James

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