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Compare debt relief programs in 2023

A debt relief company can help lower the amount you owe to debtors — but watch out for scams.

Debt relief programs like debt settlement often require making every single payment on time in order to settle all of your accounts. And for many, the benefit of paying less makes it worth the effort. Be prepared to spend three to five years working with a debt relief company to see results.

Compare legit debt relief companies

Explore your options by costs and requirements. Select the Learn more button for additional information about a specific service.

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Name Product Costs Requirements
Freedom Debt Relief
Not rated yet
Freedom Debt Relief
Monthly payment based on enrolled debt, no upfront fees
Must have at least $7,500 in unsecured debt, have a hardship is preventing the ability to pay creditors, and live in a serviced state.
Freedom Debt Relief works to help people with unmanageable, unsecured debt get back on their feet.
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.
National Debt Relief
15–25% 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 company that works with multiple types of debt.

Some of the debt relief providers we reviewed

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Before you sign up with a debt relief company

Debt relief companies typically charge a percentage of a customer’s debt or a monthly program fee for their services. And not all companies are transparent about these costs or drawbacks that can negatively affect your credit score. Depending on the company you work with, you might pay other fees for third-party settlement services or setting up new accounts, which can leave you in a worse situation than when you signed up.

Consider alternatives before signing up with a debt relief company:

  • Payment extensions. Companies you owe may be willing to extend your payment due date or put you on a longer payment plan if you ask.
  • Nonprofit credit counseling. Look for free debt-management help from nonprofit organizations like the National Foundation for Credit Counseling.
  • Debt settlement. If you can manage to pay a portion of the bill, offer the collection agency a one-time payment as a settlement. Collection agencies are often willing to accept a lower payment on your debt to close the account.

What is debt relief and is it legit?

Debt relief encompasses a wide scope of services, from negotiations with your creditors to debt management tools.

Some debt relief companies help you manage your current debt and budget repayments in an affordable way. Others, like debt settlement companies, negotiate with your creditors to reduce the amount you owe. For this to work, you may need to stop paying your creditors altogether.

Before you stop making payments, your debt settlement company should lay out all of the risks, including potential lawsuits.

In most cases, debt relief is legit. But you should avoid signing up with a company that doesn’t meet federal requirements or doesn’t provide much information on its website.

Interested? Watch our short guide where we give you the rundown of how you can qualify for debt relief and how much it may cost.

How will it affect my credit?

Credit counseling and debt management will have little to no impact on your credit score — but debt settlement or negotiation will.

If your company tells you to stop paying your creditors, you may face a lower credit score, more collection calls and a lawsuit once your debt is sold to collections.

If a lawsuit is successful, a debt collection agency may be able to garnish your wages for the amount owed, which could throw a wrench in the debt relief process.

Carefully consider the potential downsides to debt relief before signing up for a program.

Pros and cons of debt relief

  • Expert advice from debt professionals
  • Potentially reduce interest or total debt
  • Lower your monthly debt payments
  • Debt settlement programs have a low 10% completion rate
  • Forgiven debt considered taxable income
  • Creditors may pursue legal action for missed payments

5 types of debt relief programs

Debt relief doesn’t necessarily mean debt settlement. There are other ways to tackle your debt — although you’ll likely have to pay a fee for any option you find.

  1. Credit counseling. Credit counselors help people in their community learn more about managing their finances. Check if your bank or credit union offers credit counseling or browse a list of credit counselors managed by the Department of Justice.
  2. Debt management. This involves some negotiation with your creditors alongside a plan to help you pay off your debts.
  3. 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.
  4. Debt consolidation. Debt consolidation is a good choice for smaller amounts of debt — provided you have good to excellent credit. Consolidating your payments makes debt easier to manage, and you may even be able to score a lower APR and pay less interest.
  5. Bankruptcy. Bankruptcy should be your last choice. It stays on your credit for seven to 10 years and can significantly impact your ability to get a loan or credit card — even when that loan is for your business. However, it eliminates a large majority of your debt with no payment plan.

Are debt relief and debt consolidation the same thing?

Generally, debt relief refers to debt settlement or debt management, but debt consolidation can be a form of debt relief.

Debt consolidation is typically only available to people with good to excellent credit because it involves borrowing a new loan to pay off all your debts at once. This consolidates your payments, and could potentially lower them — if you’re able to score a lower average interest rate.

Debt settlement involves working with a company that will negotiate with your creditors on your behalf. The goal is to pay off your debt for less than you owe. However, most debt settlement companies charge a high fee and require you to stop paying your creditors, which could put you at risk of a lawsuit.

Debt consolidation vs. debt settlement

Debt consolidation and debt settlement are different ways to handle your debt — and have very different impacts to your credit.

What happens to debt

Same amount consolidated into one monthly payment

Potentially lowers total debt


APR between 3.99% to 35.99%

Fees depend on amount of debt enrolled or settled

Credit requirements

Good to excellent credit required

None, but proof of hardship preferred

Credit impact

Hard credit check may temporarily lower score

Missing payments to creditors will cause a negative impact to your credit


Unsecured and secured options available

None required

What to look for in a debt relief company

Consider the following factors when comparing debt relief companies:

  • Accreditation. Most legit debt relief companies are accredited with either the American Fair Credit Council (AFCC) or the International Association of Professional Debt Arbitrators (IAPDA).
  • Not banned from debt relief. Because there are scams in the debt relief world, you should check the FTC list of companies and people banned from debt relief before you sign up for any program.
  • Transparency. If you can’t find vital information like how much debt relief costs, how fees are calculated and how long the company has been in business, consider working with another provider.
  • Costs. Debt relief companies often charge a fee for 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, though some may charge a small fee depending on your state.
  • Direct or indirect negotiation. If you pick a debt settlement company, ensure it negotiates with your creditors directly. Indirect negotiation is uncommon and may put your information at risk when it transfers between 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.
  • Customer reviews. Online review sites like the Better Business Bureau and Trustpilot are a good place to look out for red flags and learn what you can expect from a debt relief company.

8 steps to make the most of your debt relief program

These steps can help you make an informed decision when you choose a debt repayment strategy.

  1. Take stock of everything you owe. Add up your total unsecured debts. Generally, you need at least $7,500 in debt to qualify for a debt relief program.
  2. Review your credit score and budget. Check your credit score using a free service online. You’ll have the most options available if you have a FICO score above 670. Then calculate your monthly cash flow by subtracting your expenses from your income. What’s remaining is what you can afford to spend on debt relief.
  3. Compare all your options. If you have good credit, positive cash flow and owe less than half of what you make in a year, a debt consolidation loan can be a good choice. But hiring a debt relief company to negotiate down your balance in exchange for a one-time payment may be a good option for higher debt loads.
  4. Meet with a credit counselor. Nonprofit credit counseling agencies often offer free sessions to people who want professional advice on how to start. In a typical session, you’ll go over your finances and come up with a debt repayment plan.
  5. Understand the full cost. One of the top complaints about debt settlement is that it’s more expensive than expected. You can adjust your expectations by going in knowing how much you’ll owe on your accounts by the end of the program and being prepared to pay taxes.
  6. Play it safe. Don’t make any major career or life decisions that can impact your finances while you’re in debt relief. Changes to your income can make it difficult to keep up with your monthly payments toward your creditors and settlement fund.
  7. Make payments on time, every time. Missing a payment toward your debt relief program can cancel your contract.
  8. Don’t take on more debt. Most debt relief programs tell customers to stop using their credit cards while they’re enrolled. And with a debt load high enough to qualify for debt relief, you likely won’t be able to qualify for a new credit card or personal loan.

Finder’s top guides and reviews on debt relief

What to know about debt settlement costs

While debt settlement can be helpful for a lot of people, know what you’ll have to pay before you get started.
  • Fees aren’t based only on your initial debt. Fees depend on your total debt and are hard to predict. It depends on how quickly your debts are settled, how interest accumulates, if you continue payments, whether you have late fees and more.
  • Debt settlement counts as income. Any settled debt of more than $600 is considered taxable income. After taxes, you could end up saving only 10% — or less.
But there’s a tax loophole: You might be exempt if your tax liabilities are greater than your assets at the time of the settlement. Talk with a tax specialist before enrolling in a debt settlement program to learn how this exemption might affect you.

Beware of debt relief scams

While most debt relief companies are legit, there are scams out there. 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 of credit counselors.

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.

It also pays to be aware of your state laws. Ensure that any debt relief company or attorney you’re working with holds the appropriate licenses and follows state regulations.

Student loan debt relief scams

The most recent government crackdown has focused on student loan debt relief scams — one reason why most legit debt relief companies won’t touch student loans. Watch out for any offers that try to get you to sign up for a new program fast, customer service reps that ask for your login information and anyone who claims to be a representative from the Department of Education. And check out our guide to avoiding student loan debt relief scams for more tips on what to look out for.

10 myths about debt relief

  1. My debt will eventually drop off my credit report, so why should I pay it off? While a default only stays on your credit report for seven years, creditors — or more likely, collections agencies — will still demand you pay off your account.
  2. Filing for bankruptcy is better than debt relief. Filing for bankruptcy will stay on your credit report for seven to 10 years, making it difficult to qualify for financing in the future. With debt relief, you have a better chance of keeping your credit score above water.
  3. All debt relief companies are scams. You can make sure you aren’t signing up for a scam by checking the Federal Trade Commission’s list of companies and people banned from debt relief.
  4. I can’t settle debts on my own. Anyone can pick up the phone and negotiate down the debt on their own. But debt settlement companies are seasoned negotiators and already have established relationships with creditors.
  5. Debt relief programs will take forever. Debt relief programs usually take between two and four years to complete. How long it takes depends on how quickly you can save up the funds to pay off your account — and how willing your creditors are to settle.
  6. Few people actually have their debts settled. On average, 74% of people successfully settle at least one account through a debt settlement program, according to a January 2021 report by the Harvard Kennedy School.
  7. Debt relief companies charge fees up front. It’s now illegal for any debt settlement company to charge fees up front, thanks to a 2010 amendment to the Telemarketing Sales Rule.
  8. I can’t get out of debt if it was already sold to a debt collector. If you reach out and propose a payment plan or a settlement, they might accept. It’s their job to collect on your debt, after all. It’s only after you receive a default judgment that negotiating gets tricky.
  9. Debt settlement companies can guarantee to settle my debts. It’s illegal for debt settlement companies to guarantee that they’ll settle all or any percentage of your debts, according to the Telemarketing Sales Rule.
  10. Debt relief automatically helps my credit score. Debt settlement can improve your credit score — if you’re able to complete the program without defaulting on any of your accounts.

Debt relief alternatives

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 methods 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

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

Frequently asked questions

What debt relief programs does the government offer?

The government itself doesn’t offer debt relief programs, 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.

How do I continue to use my credit cards after I receive 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 rebuild your credit score.

What debt relief options exist for overdue taxes?

Work with the IRS to design 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, 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.

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