Perhaps you are considering a debt resolution program or could be in the process of completing one. You might be wondering what life will be like after you finally pay off all your enrolled debts.
Life after debt resolution, like life in general, will be unique for everyone. Fortunately, when you enroll in a program like ours, your path will be mapped out for you by a Consolidation Specialist.
People who complete our program can look forward to benefits that may include more control over their finances, good financial habits, a lower debt-to-income ratio and greater confidence with money.
Completing Your Debt Resolution Program
Most debt resolution programs take 24 to 48 to complete—our average client completes the program in 21 months and resolves an average of $28,000 in unsecured debt. Your time in the program is an opportunity for you to slow down, regroup, and establish good habits that will serve you in your life after debt resolution.
Most people like to focus on the freedom they will have once they complete the program. It’s natural to want to get through the program as fast as possible because the promise of financial freedom waits for you on the other side. However, your program length is designed to set you up for success with a monthly deposit amount that works with your budget.
The Benefits and Challenges of Completing a Debt Consolidation Journey
- More control over your finances
- Lower debt-to-income ratio
- Good habits that will help you stay out of debt
- Increased confidence and satisfaction
- Time and money to focus on the future
More Control Over Your Finances
Enrolling in debt resolution can help you take control of your finances right away by making your monthly payments more manageable and budget-friendly. Lower monthly payments alleviate short-term money concerns and can help reduce debt-related stress. Further, you get to watch your money grow in your dedicated account and power your program as each agreement is approved and paid.
- In a recent survey of our graduated clients, 98% of respondents said that the monthly deposit amount positively impacted their experience.*
Lower Debt-to-income Ratio
Completing a debt resolution program lowers your debt-to-income ratio.
The debt-to-income ratio (DTI) is the percentage of your gross monthly income you use to pay off debt. Improving your DTI can make you eligible for better interest rates on mortgages, car loans, or high-reward credit cards. As you pay off your resolution agreements, your DTI will go down.
Did you know that 43% is the highest debt-to-income ratio (DTI) you can have and still get approved for a mortgage? The ideal DTI is between 28% and 36%.
Good Habits That Will Help You Manage New Debt
Enrolling in a debt consolidation program allows you to shift your focus. Instead of worrying about paying your bills, you can develop good financial habits that lay a foundation for your future. This includes budgeting, financial planning, building your credit score, and the ability to take on new debt.
Debt resolution can have an impact on your credit score. Sometimes, people worry that this will prevent them from taking on new debt.
In our experience, clients who complete a debt resolution program and focus on good financial habits can recover or improve their credit scores over time and do not have trouble taking on new debt. They also report that their habits are more responsible.
- Within three months of graduating, 75.6% of those we surveyed reported a recovered or improved credit score after graduating from the program compared to their score when they enrolled.*
- On a scale of 1 to 10 (10 being “very responsible”), they rated themselves 8.6/10 after completing debt resolution vs. 5.6/10 before.*
Increased Confidence And Satisfaction
Completing a program through consistent, manageable monthly deposits will build your confidence. Once you’ve proven to yourself that you can conquer your debt, it helps you establish new goals, like saving and investing, feel within reach. Most people report better financial habits after completing a debt resolution program.
- 87.7% of clients in our survey said they are very confident in managing and paying off new debt.*
Time and Money To Focus On The Future
Paying off your debt faster and for less money sounds great because it is great. However, the true impact of a successful debt resolution program is what you get to do with your time and money once your debt is resolved.
When we compared the cost of debt resolution vs. making minimum payments, the savings are staggering.
- For example, if you had $25,000 in debt, making minimum payments would take more than 30 years and cost $72,262 due to accumulated interest. On the other hand, debt resolution could resolve your debt in around four years and would cost $18,750. What could an extra $53,512 do for your future?
Completing a Debt Resolution Program is An Accomplishment
The many benefits set you up for success in your life after debt resolution. If you are searching for debt consolidation, consider speaking with a Consolidation Specialist to determine if our program is right for you.
*In October 2020, Accredited Debt Relief surveyed clients who had recently graduated from our debt resolution program in the past three months. The data pertaining to “recently graduated clients” cited in this blog is taken from this survey.