Debt Relief Finder

Debt relief encompasses a wide a range of services, from helping you budget to negotiating with your creditors on your behalf. But watch out for companies that guarantee results or won’t disclose the cost up front.

What phase are you in?

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  Compare providers
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  Types of debt relief
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  Weigh the risks
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  How to sign up
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  Debt relief alternatives

Should I sign up for debt relief?

You might want to consider signing up for debt relief if you answer “yes” to the following questions:

1. Are you struggling with unsecured debt other than student loans or unpaid taxes?
2. Is your unsecured debt more than 50% of your annual income?
3. Is repaying your debt over the next five years impossible with your current budget?
4. Have you recently faced financial hardship?

But debt relief isn’t the right choice for everyone. If you could pay your debts off within five years and are confident in your ability to negotiate with your creditors, you may want to skip the fees debt relief companies charge. Instead, it may be worth doing it yourself — provided you are able to stick to a strict budget and repayment plan.

Compare debt relief companies

Start your search for the company that best fits your financial need by comparing costs and requirements.

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Name	Product	Costs	Requirements
National Debt Relief		18–25% of total enrolled debt	Must have a legitimate financial hardship which is preventing the ability to pay creditors and a minimum of $7,500 in debt.	Get back on your feet with a top-rated debt relief company that works with multiple types of debt.	Check my rate View details		loading Fetching your data...
Freedom Debt Relief		Monthly payment based on enrolled debt, no upfront fees	Must have at least $7,500 in unsecured debt and live in a serviced state.	Freedom Debt Relief is a debt settlement company that works to help people with unmanageable, unsecured debt get back on their feet.	Check my rate View details		loading Fetching your data...
Accredited Debt Relief		Charges and fees vary by the company you're ultimately connected with	Must be at least 18 years old and a legal US resident; additional terms may apply based on services and products used.	This A+ BBB-rated service offers free consultations to lower your monthly payments help you get out of debt faster.	Check my rate View details		loading Fetching your data...
Pacific Debt		15%–25% of total debt enrolled. Fees vary by state of residence.	Reside in a state where PDI’s services are available and have $10,000+ of debt to enroll	Check my rate View details		loading Fetching your data...
Consolidated Credit		Fees regulated by client's state of residence, can range from$0 to $69 with an average monthly fee of $35. No upfront or contingency fees.	Debt must not be payday loans or secured loans.	This debt settlement alternative can help you find a path to financial freedom.	Check my rate View details		loading Fetching your data...
American Credit Card Solutions		No upfront costs — settlement fees range from 15% to 25%, depending on your state of residence and amount of debt.	Must live in a state that American Credit Card Solutions serves, $10,000+ in unsecured debt, legitimate financial hardship which is preventing the ability to pay creditors	Overall positive customer ratings — but it's only available in 25 states.	Check my rate View details		loading Fetching your data...

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What services do debt relief companies offer?

There are five types of debt relief you can utilize to start paying off your debt.

• Credit counseling. Credit counselors are nonprofit organizations that help people in their community learn more about managing their finances. You can browse a list of credit counselors managed by the Department of Justice.
• Debt management. Debt management involves some negotiation with your creditors alongside a plan to help you pay off your debts.
• Debt settlement. Similar to debt management, a debt settlement company negotiates on your behalf. It pays your creditor, and then you pay back the debt settlement company in low monthly payments over three to five years.
• Debt consolidation. Debt consolidation is a good choice for smaller amounts of debt — provided you have good to excellent credit. You can consolidate your payments to make debt easier to manage, and you may even be able to score a lower APR and pay less interest.
• Bankruptcy. Bankruptcy should be your last choice. It stays on your credit for 7 to 10 years and can significantly impact your ability to borrow. However, it eliminates a large majority of your debt with no payment plan.

How to compare debt relief companies

Consider the following factors when comparing debt relief companies:

• Eligibility. Many companies have restrictions on your total debt balance, types of debt and where you live. And some debt relief companies are geared toward different credit scores and income ranges.
• Costs. Debt relief companies often charge a fee that’s either a percentage of the total amount of debt you have or the amount they’re able to reduce your debt by. Most credit counseling services are free.
• Transparency. Can you find all of the information you need online? Can customer service answer additional questions? If you can’t find vital information like how much it’ll cost beforehand, consider working with another company.
• Accreditation. Most legit debt relief companies are accredited with either the American Fair Credit Council (AFCC), the International Association of Professional Debt Arbitrators (IAPDA) or the Better Business Bureau (BBB).
• Customer reviews. Online review sites like the BBB and Trustpilot can be a great place to look out for red flags and learn what you can expect from a debt relief company.

How can I benefit from debt relief?

Debt relief isn’t a sure thing and each service serves a different purpose, but some people can benefit from working with a professional debt relief service.

• Expert advice. Legit debt relief services let you hear from experts who have dealt with situations like yours before.
• Lower monthly expenses. A major part of debt relief programs is making sure your repayments fit into your budget.
• Potential savings. Debt consolidation, management and settlement can reduce your interest or even how much you owe.
• Bankruptcy alternative. Successfully completing a program can help you avoid the bankruptcy process and that negative line on your credit report.

What should I be concerned about?

Unless you’re just looking to sign up for a few budgeting workshops, the services offered by debt relief companies can land you in a worse situation than you started. Potential risks to consider depend on what type of debt relief option you sign up for.

• May not complete the program. Only around 10% of people who enroll in debt relief programs actually complete them. If you fail to complete the program, you might have to file for bankruptcy.
• Limited savings. Settled debt is usually considered taxable income. And once you factor in fees and interest that accumulated while you were in the program, you might not save as much as you thought you would. You could end up even paying more.
• Hidden fees. Some debt relief providers rely on servicing companies to manage your repayments. These companies might charge a fee, which the debt relief provider might not disclose when you sign up.
• Potential lawsuits. Some companies say it’s OK to stop paying your creditors. This is risky advice because the debt may be sold to a collections agency. And if you don’t pay the collections agency, you could face a lawsuit.

Aren’t debt relief companies a scam?

Some debt relief companies are scams, but not all of them. The federal government has made an effort to crack down on scammers since 2010. It’s easier to find a legit credit counseling agency than any other type of debt relief company — they’re mostly nonprofit and the Department of Justice has already done most of the work for you by compiling a government-approved list.

4 signs of a debt relief scam

It should set off alarm bells if you a see a company committing any of these offenses:

1. It charges upfront fees for its services.
2. It guarantees a specific amount of debt savings.
3. It promises it can settle lawsuits and stop calls from collection agencies.
4. It advertises itself as a new government program that can erase your debt.

Is debt relief legal in my state?

Most states require debt relief companies to get a license, file a bond with the state or both. Many also have rules restricting what types of services debt relief companies can offer and capping fees. Because of this, some debt relief companies may not be available in your state.

The states a company operates in can change along with the laws — reach out to make sure it’s currently operating in your state before signing up.

• Are debt relief law firms legal?

  Usually, yes — but that doesn’t mean they’re a good idea.

  After the FTC regulations in 2010, some debt relief companies restructured themselves as law firms, which don’t have to comply with state or federal rules. There are some legit law firms out there, but it’s a good idea to check for common red flags — like charging fees before settling debt — before working with one.

Debt relief regulations by state

• Map
• List

How to sign up for debt relief

Think debt relief might be right for you? Follow these steps to get started:

1. Evaluate your debt.
2. Consider credit counseling first.
3. Compare debt relief companies.
4. Speak with a representative.
5. Review your debt relief plan.
6. Sign the paperwork to start the debt relief process.

I signed up. Now what?

Now it’s up to you to complete your program. Keep an eye on your balances and stay in touch with your point of contact. Be sure to reach out if you have any questions or are unsure about how something works.

5 ways you can make debt relief a smart choice

It takes self control and persistence to successfully complete a debt relief program. Here are a few tips that may be able to help:

1. Avoid taking on more debt. Many companies require you to close your accounts and avoid opening new ones while you’re paying off your current balances.
2. Watch your credit score and report. Know what to expect and monitor your credit report for any irregularities. In general, debt settlement programs can cause your credit score to take a dive. Debt management shouldn’t affect your score, but you might see a line on your report indicating you’re paying off a debt through credit counseling. Other types of debt relief shouldn’t affect your credit score or report at all.
3. Continue paying your creditors. If you have the means, continue to make at least the minimum payments. This will keep interest and late fees from piling up — and help you avoid harassing calls from collection agencies and keep potential lawsuits at bay.
4. Make sure everything adds up correctly. Do your fees match up with your original agreement? If you see anything out of the ordinary, call your debt relief company. If the numbers don’t add up, you may need to re-evaulate your company and find a different solution.
5. Take advantage of free resources. Credit counseling agencies and other debt relief companies often provide tools to help you stick to a budget or rebuild your credit score. Use them to get back on track faster.

Debt relief alternatives

You can handle your debt on your own with determination and a manageable budget.

• Repayment strategies. While it won’t result in a reduction to the amount you owe, you can adopt a repayment strategy like the debt avalanche or snowball to build your budget and pay off your debts in manageable chunks.
• DIY negotiations. Debt management and debt settlement companies negotiate on your behalf, but you can reach out to your creditors on your own. Explain your situation and see if you can lower the amount you owe or modify your repayment schedule.

Bottom line

Debt relief encompasses a wide scope of services, from debt negotiations with your creditors to debt management tools. Avoid signing up with a company that doesn’t meet federal requirements or otherwise rubs you the wrong way. And make sure you’ve exhausted other options like debt consolidation loans before taking any risky steps.

If you’ve decided on settlement, consider these top debt relief companies when you’re ready to get started.

Frequently asked questions

• Can I use my credit cards after I've sought debt relief?

  It depends on the type of debt relief you’re participating in. Talking with a credit counseling agency shouldn’t affect your ability to use existing credit cards. But a debt settlement or debt management program might require you to cancel your credit cards or could result in your credit card companies canceling your cards.

  You might be able to apply for additional cards after you’ve finished your debt relief program, but you won’t be able to use your old ones. Look into secured credit cards designed to help you rebuild your credit score.

• Are there debt relief options for overdue taxes?

  Yes. You can work with the IRS to come up with a payment plan, reduce the amount of debt you owe or even pause collections on your debt. This service is done directly through the IRS, rather than an outside company. Alternatively, you can take out a personal loan to pay off your tax debt if you just need to break it up into more manageable installments.

• How can I benefit from the Mortgage Forgiveness Debt Relief Act?

  If your mortgage is canceled, you might not have to pay income taxes on up to $2 million of that canceled debt, according to this 2007 law. However, not everyone can qualify. Contact a tax specialist to make sure you meet all criteria.

• Does the government offer debt relief programs?

  No, but you’ll find government-approved credit counseling agencies. Avoid any debt relief companies advertising a “new” government debt relief program — it’s a common scam tactic designed to steal your money.

• Can I get a debt relief grant?

  No, foundations and government programs don’t offer grants to individuals.

• What is debt forgiveness?

  Debt forgiveness is one result of negotiation with your creditor, like a credit card company or loan provider. With debt forgiveness, your creditor agrees that you don’t have to pay back a portion or all of your debt.

  Debt forgiveness is not without consequence, however. It can come with expensive fees, raise your tax bracket, damage your credit and more.