How Long Does Debt Settlement Take?

A 2026 study by EY (Ernst & Young), one of the Big Four accounting firms, looked at an estimated 4.3 million debt settlement clients who enrolled from 2016 to 2022. The Association for Consumer Debt Relief (ACDR), a debt relief industry trade group, commissioned it. For clients who reached a settlement, the first one came about four months after enrolling, on average, and later settlements followed every few months. Here’s the timeline.

The Timeline at a Glance

• First settlement: Clients who reached a settlement got their first one about four months after enrolling, on average.
• Nearly all by month eight: Of clients who reached a first settlement, 96% had it by the eighth month.
• Later settlements: The second, third, fourth, and fifth settlements came at about eight, 11, 14, and 16 months, on average, for clients who reached them.
• Each debt: The average settled debt reached its settlement about 13 months after the client enrolled.
• Multiple settlements: 72% of clients settled at least one debt, 64% settled at least two, and 59% settled at least three.

Why Debts Settle One at a Time

In a debt settlement program, clients make deposits into a dedicated savings account they control. As the money builds up, the debt settlement company negotiates with each creditor to resolve the debt for less than the full balance.

Because settlements are negotiated and funded one account at a time, EY notes, a client’s debts can be resolved at different points in the program. That’s why the study measures timing settlement by settlement.

EY limited its results to clients who enrolled from 2016 to 2022, so every client had at least three years in the data by the end of 2025. That lets the timing figures reflect finished outcomes rather than snapshots of programs still underway.

When the First Settlement Comes

The first settlement tends to come early. For clients who reached one, it arrived about four months after enrolling, on average.

EY also tracked how quickly clients got there. Of the clients who eventually reached a first settlement, 16% had it in their first month, and 96% had it by their eighth month. In other words, nearly everyone who reached a first settlement did so within eight months. EY used the four-month average in its own example comparing settlement with minimum payments on a $3,600 credit card.

Later Settlements Come Every Few Months

After the first settlement, later ones followed every two to four months, on average. This chart shows the average timing for clients who reached each one.

Source: EY, Debt Settlement Program Outcomes, 2016–2025, p. 7, Figure 3

Each settlement resolves one more debt, so a client with several enrolled debts sees them settled one after another.

How Many Debts Clients Settle

Most clients settled more than one debt. 72% reached at least one settlement, 64% reached at least two, and 59% reached at least three. The average client enrolled about seven accounts, so settlements usually come as a series rather than all at once.

How Long Each Debt Takes

Measured one debt at a time, the average settled debt reached its settlement about 13 months after the client enrolled. That’s longer than the four-month average for a first settlement because it counts every settled debt, including those settled later in the program.

Most settlements were paid in installments, and those reached settlement about three months sooner than lump-sum deals, on average:

Lump-sum deals settled for a little less, $1,940 on average compared with $2,020 for installment settlements.

Progress Over the Years

For clients who went on to settle at least half of their enrolled debt, most of the progress came early. On average, these clients had settled 52% of their enrolled debt within 12 months and 84% by 36 months.

Source: EY, Debt Settlement Program Outcomes, 2016–2025, p. 10, Table 4

By month 72, they had settled 91% of their enrolled debt, on average, counting clients enrolled that long. Counted by accounts instead of dollars, the pattern is the same: 51% of their accounts were settled within 12 months and 89% by month 72.

What to Expect

Based on EY’s averages, here’s how a debt settlement program tends to unfold for clients who reach settlements:

• Before enrolling: Debt settlement companies screen applicants for eligibility.
• The first few months: Clients build up deposits in their dedicated savings account, and the first settlement comes about four months in, on average.
• The first year and a half: Later settlements follow every few months, with the second at about eight months and the fifth at about 16 months.
• The years that follow: Clients who settle at least half of their enrolled debt keep resolving debts, with 84% of their enrolled debt settled by month 36 and 91% by month 72, on average.
• Paying each settlement: Most settlements are paid in installments, about 15 payments on average, and 90% of installment settlements in EY’s data were completed.

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