Debt Relief / Calculator

Debt Settlement Calculator: Estimate Cost, Duration, Pros and Cons and Alternatives

Written by Ben Tejes
Updated Sep 6th, 2022

You may be struggling with debt and wonder whether a debt settlement calculator can inform you about the cost and pros and cons and settlement options of debt settlement. A calculator can definitely do that and more.

Below is the debt settlement calculator that provides your payment plan estimate and compares that option against other debt relief options such as debt management, payoff planning, Chapter 7 and Chapter 13. We also include pros and cons to make sure you are informed.

How the Debt Settlement Calculator works

A debt settlement calculator should help you estimate the all-in cost and duration of debt settlement. It should also outline how the fees work. Thus, the results should help you compare the cost and duration of debt settlement's monthly payment to your current monthly obligations. The debt settlement calculator below also helps you compare debt relief to other options such as debt management, payoff planning, Chapter 7 and Chapter 13 bankruptcy.

Let’s now cover the inputs into the debt relief calculator to show you how we come up with the calculations.

Cost and Duration

The debt settlement calculator first estimates that the debt settlement firm will negotiate to a 50% settlement on the enrolled debt. Next, the debt relief calculator generally estimates a fee between 15-20% of enrolled debt. Many debt relief companies charge up to 25-27% of enrolled debt, but if your case isn’t extremely challenging, those fees can be quite high.

Next, we would use the fee and the estimated settlement percentage to help you understand your duration. Many debt settlement companies will all you to have plans between 36 and 60 months.

Here’s an example of a debt relief calculator result.

Image shows the debt settlement calculator results with a $609 payment for 48 months.


The debt relief calculator has a variety of assumptions to consider. First, the calculator assumes a settlement percentage of 50% average across the board. This is a blended 50% average, so some accounts you may settle for 40% and some accounts, you may settle for 60%.

Next the calculator assumes that all creditors will negotiate a settlement. Finally, the assumptions are that fees are interest would be included in the settlement percentage.

Image shows the Debt Relief Calculator assumptions

Pros and Cons

The debt settlement calculator also shows the pros and cons of  the debt settlement option, but it can also include debt management, debt payoff planning, Chapter 7 and Chapter 13 bankruptcy.

Your Options

Next, the debt relief calculator also shows specific options that Ascend has vetted that you can utilize for debt settlement, bankruptcy, debt management and debt payoff planning. Each of these options provide free evaluations to go through that option, so you can compare and contrast to make the most informed decision.

Your Questions

The debt settlement calculator also provides an avenue where you can ask questions. For example, you can add your question and get responded to by email, phone or text. Debt settlement is complicated, so the calculator has a space for you to ask questions.

Deeper Dive into the Debt Settlement Calculator Pro and Cons

The debt relief calculator provides a deeper dive of the pros and cons, so let’s go through those now.


While debt settlement can be a great option for many people, let's chat about the pros and cons of debt settlement

There are negative implications of debt settlement, but there are also many positive attributes for those who are struggling with debt and cannot continue to make ends meet. Let's go through the pros.

  • Savings - Probably the most compelling is that you can save money and alleviate some financial stress.
  • Flexibility of Payments - You are able to be somewhat flexible in how much you save each month into your escrow account.
  • Time - You often get on a fixed payment plan and it is much faster than continuing to make minimum payments.
  • Bankruptcy - Some folks want to avoid bankruptcy, so it can allow the avoidance of bankruptcy.
  • Flexibility in Financing - You may have access to credit sooner than other debt relief options.
  • Accountability - You often cancel your credit cards while in debt settlement, which produces accountability.


With all debt relief options, there are a host of cons as well to consider when choosing whether debt settlement is right for you. Let's go through the cons.

  • Negative credit score and report impact - Your credit score will often be negatively affected while in the program, especially before the debt has been settled.
  • Lawsuit - Creditors may file lawsuits. This can often be avoided, but it still may happen.
  • Late fees and interest - Before the credit card and personal loans go into non-accrual, interest and late fees may continue to accrue.
  • Creditor specific - A creditor may not work to settle the debt.
  • Taxes on forgiven debt - In some cases, there are potential taxes on forgiven debt. We highlight this information in this article.

Debt Settlement Alternatives

The debt settlement calculator also covers alternatives such as Chapter 7 bankruptcy, Chapter 13 bankruptcy, debt management and debt payoff planning.

There are a number of alternatives to debt settlement. Each has it's own pros and cons, so understanding these pros and cons should help you make the right decision.

Debt Management

Debt Management is a common alternative to debt settlement. In debt management, the non profit company negotiates interest rates instead of debt amounts. Thus, you may save less money with debt management, but your credit score may stay more intact.

Debt Payoff Planning

Debt Payoff Planning is where you prioritize which debt you pay off fastest by paying more than the minimum balance. In this option, you have to have more than the minimum balance to prioritize specific balances to get you out of debt faster. 

Chapter 7 Bankruptcy

Chapter 7 Bankruptcy is often the cheapest and fastest debt relief option. You can eliminate much of your unsecured debt within 120 days. That said, a Chapter 7 bankruptcy is on your credit report for 10 years, so that’s something to consider.

Chapter 13 Bankruptcy

Chapter 13 Bankruptcy is a wage earner’s plan that is often a 3 or 5 year plan that is a court ordered plan. The attorney fees can be much more expensive and the trustee fees may also be more expensive. 

Should I pursue Debt Settlement?

Hopefully the debt settlement calculator above shows you the estimated cost of debt settlement compared to the cost of such alternatives like debt management, debt payoff planning, Chapter 7 bankruptcy, and Chapter 13 bankruptcy.

So based on the debt relief calculator, should you sign up for a debt relief program?

It depends. Debt settlement may be a good option for some, but definitely not for others. For example, in some cases, bankruptcy may be a more appropriate option if the debt is completely unaffordable. In other situations, you do not need any debt relief and can get out of debt on your own through tighter money management.

Regardless, the debt settlement calculator should help you make the most informed decision.