Utah Foreclosure Process

In Utah, when a borrower is 30 days late with a payment, this is known as an “Event of Default”. After the default, the lender (through a trustee) must file a “Notice of Default”. This Notice of Default may be filed as early as 30 days after the late payment, but is more typically filed 60 to 90 days after a late payment.

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Mortgage Debt Relief Act

If you owe a debt to someone else and they cancel or forgive that debt, the canceled amount may be taxable.

The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief.

This provision applies to debt forgiven in calendar years 2007 through 2012. Up to $2 million of forgiven debt is eligible for this exclusion ($1 million if married filing separately). The exclusion does not apply if the discharge is due to services performed for the lender or any other reason not directly related to a decline in the home’s value…

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