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PowerPayTM Debt Reduction Software

With the total amount of consumer debt in the U.S. standing at nearly $2.5 trillion, the average debt per person is a startling $8,200. Of this debt, which does not include debt secured by real estate, 37% is credit card debt. According to the Federal Reserve, changes in the financial services industry are to blame for allowing lower-income consumers to have increased access to credit markets that they previously did not have. Utah State University professors have developed a user-friendly software program to help consumers understand the quickest way out of debt, particularly elusive open-ended consumer debt. This program has been well-received by the military, credit counseling, and credit union communities because of its ability to demonstrate to clients the impact of different payment scenarios when multiple creditors are involved.
   
Applications
Features and Benefits
  • Personal financial management planning
  • Credit counseling tool
  • Educational tool for advisors to members of the armed forces and government agencies
  • Distribution to consumer market
    customer service use for mortgage and bank loan departments
  • Member services for credit unions
    Make available as employee benefit
  • Multiple payment scenarios, resulting in user flexibility for payment plans
  • Breakdown allows user to look at in interest costs savings and months to repay, resulting in better planning
  • Easily compares 4 debt pay-off sequences, optimizing interest savings
  • Allows one-time lump sum payment, increasing practicality of program
  • Allows scenario planning, such as possible savings from consolidating some or all the debts
 
Technology
The POWERPAY computer program is an easy-to-use educational tool that allows consumers or financial advisors to quickly visualize and appreciate the impact of power payments on individualized consumer debt situations. Initially POWERPAY calculates what the repayment time and interest costs will be if the consumer continues making payments at current levels. It is shocking for most consumers to see the interest costs and the length of time it takes to repay debts, especially if they are making only the minimum required payment. The POWERPAY calculates the possible savings of rolling over partial or full power payments to creditors according to three scenarios: paying off creditors with highest interest rate first, paying off creditors with lowest balance first or paying off creditors with shortest term first.
 
Development Stage
PowerPay is currently in version 5.0 and has been in use for over a decade. Site licenses are available for institutional use.
 
CONTACT INFORMATION
Allan Wood
Commercialization Associate
Technology Commercialization Office
Allan.Wood@usu.edu
(435) 797-2515
Reference: W05049
www.ipso.usu.edu

 

 

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