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Best debt relief companies

Find an IAPDA-accredited company with a good reputation.

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By

Anna Serio

Updated

Fact checked

Debt relief companies are designed to act as a last resort before filing for bankruptcy. If they sound too good to be true, that’s because they sometimes are — especially before the Debt Settlement Consumer Protection Act passed in 2010. But you can find trustworthy companies that have relationships with creditors and can reduce your debt.

Before you sign up, look into free options like working with a nonprofit credit counselor or working with your creditors yourself. That could save you hundreds or even thousands in debt relief fees, depending on how much you owe.

6 best debt relief companies to work with

Best overall

Accredited Debt Relief

Go to site Read review

Accredited Debt Relief offers debt settlement, debt consolidation loans and credit counseling. It claims to reduce your balance by around 50% of what you owe, and charges fees between 15% and 20% of your enrolled debts.

Accredited Debt Relief works with most major banks and lenders and advertises that you can be out of debt in as little as 12 months. It gets overwhelmingly positive reviews online and has relatively few complaints on review sites like the Better Business Bureau.

  • Not available in: Delaware, Hawaii, Kansas, Maine, Minnesota, New Hampshire, North Dakota, Oregon, Rhode Island

Best for student loans

National Debt Relief

Go to site Read review
This debt settlement company is one of the few that will work with private student loan providers — though federal loans are always off the table when it comes to student loans. Costs start relatively low, though they can run as high as 25% of your settled debt amount. And if you aren't happy with your experience, National Debt Relief claims to offer a 100% money back guarantee. But it gets mixed customer reviews, especially compared to other debt relief companies.
  • Not available in: Connecticut, Kansas, Maine, New Hampshire, Oregon, South Carolina, Vermont, West Virginia

Best for low-cost debt management

Consolidated Credit

Go to site Read review
This debt settlement company charges fees as low as 16% of the debt you enroll in its debt settlement program. There's also no minimum debt requirement — but the average customer brings over $750. The average turnaround is around two years — much faster than most debt relief companies. And it offers discounts of up to 4% for military personnel and veterans. But the types of debt you can enroll in are relatively limited. Medical bills, taxes and loans from credit unions are off limits.
  • Not available in: Hawaii

Best for low-commitment debt relief

American Credit Card Solutions

American Credit Card Solutions offers a 30-day trial period where you can pull out with full refund on any fees you've paid on enrolled debts that haven't been settled. And the fees themselves start low, at 15% — but can also run as high as 25%, depending on your state. But it's only licensed in 17 states. And it requires you to enroll at least $10,000 — high compared to many other companies.
  • Available in: Alabama, Alaska, Arizona, Arkansas, California, District of Columbia, Florida, Maryland, Michigan, Nebraska, New Mexico, New York, North Carolina, Oklahoma, Pennsylvania, Texas, Wisconsin

Best for low-cost debt settlement

New Era Debt Solutions

This debt settlement company charges fees as low as 16% of the debt you enroll in its debt settlement program. There's also no minimum debt requirement — but the average customer brings over $750. The average turnaround is around two years — much faster than most debt relief companies. And it offers discounts of up to 4% for military personnel and veterans. But the types of debt you can enroll in are relatively limited. Medical bills, taxes and loans from credit unions are off limits.
  • Not available in: Hawaii, Maine

Best for tax relief

CuraDebt

Read Review
CuraDebt is one of a handful of companies that offers tax relief. And while CuraDebt's 20% fee is on the high end, the savings might make up for it. It claims to have settled up to 100% of some of its clients debts in the past. How? It goes after the legality of the debt, rather than just trying to negotiate it down. But its customer service is lacking — we couldn't get a straight answer from customer service. And it doesn't have a lot of basic information available online.
  • Not available in: Colorado, Illinois, Washington, Wisconsin

How we choose the best debt relief companies

Finder’s lending experts analyze the rates, services and reputation of nearly 20 debt relief companies available on the market to narrow down our best picks.

We analyze and weigh such factors as fees, how long it typically takes to settle accounts and debt enrollment minimums. We also look at accreditation from trade organizations like the International Association of Professional Debt Arbitrators (IAPDA) and the American Fair Credit Council (AFCC), which set and maintain industry standards. Other factors we consider include the types of services offered and types of debts they accept, as well as any additional perks — like discounts for service members.

We update our best picks as debt relief products change, disappear or emerge in the market and to reflect the most competitive products available.

What is debt relief?

Debt relief refers to services designed to help you reduce or restructure your debt. The following types of programs typically fall under debt relief:

  • Debt settlement. Debt settlement is offered by accredited companies like National Debt Relief, who negotiate down your balance with creditors in exchange for a lump-sum payment. Debt settlement is the most common form of debt relief, but it impacts your credit score and comes with certain risks.
  • Debt consolidation. This option involves taking out a personal loan or balance transfer credit card with a lower rate to pay off your credit accounts. It’s more expensive than debt settlement, but it won’t hurt your credit score as long as you make your payments.
  • Credit counseling. With credit counseling, you meet with an expert to go over your budget, bills and credit account to find a way to manage your debt. It won’t lower what you owe, but it can give you the tools to tackle your finances.

Debt settlement is the most common type of debt relief out there — but also the most risky. That’s because you may have to stop making payments to your creditors to keep up with the monthly cost of the program. Stopping payments will damage your credit score, increase the amount you owe in interest and fees and put you at risk of being sued by your creditors.

How debt settlement works

Debt settlement is when an accredited, for-profit business negotiates with your creditors on your behalf to settle your debt for less than what you owe. Many debt relief companies claim they can reduce your debt by about 50%, with programs lasting 12 to 48 months. Fees run about 15% to 25% of the debt amount you enroll in the program.

When you enroll your debts with a debt relief company, you stop paying your creditors and send payments to the debt relief company instead. After 90 to 120 days, the debt relief company reaches out to your creditors to settle your debt, using the money in your account to negotiate. By law, you control these funds and can even withdraw from them at any time without a penalty.

However, debt settlement can be risky. Fees and interest accrue while your accounts go unpaid, and creditors are not legally obligated to accept the settlement. If things go awry, you could end up owing more than you bargained for.

Working with a reputable debt settlement company can help reduce the risk. At a minimum, make sure the company is accredited with the International Association of Professional Debt Arbitrators or the American Fair Credit Council, which set and maintain industry standards.

What to know about debt settlement fees

It’s illegal for debt relief services to charge you a fee before they’ve provided results. Most legit companies also won’t ask for fees all at once, preferring steady payments toward settlement accounts and services.

How much will I pay with debt settlement?

Debt relief companies usually charge a fee of 15% to 25% of the each credit account it settles. While it’s not free, it can ultimately offer savings compared to the amount you’d pay in interest on credit card accounts — or even a debt consolidation loan.

Here’s an example of how much you might pay if you use a debt relief program compared with a debt consolidation loan at 11.08% APR or minimum credit card payments toward $25,000 in debt at 23% APR.

$25,000 debt costs using debt relief vs. consolidation loan vs. payments

Debt reliefDebt consolidation loan at 11.08% APRMaking minimum payments only at 23% APR
Monthly payment$408$500$700
Total repayment$18,750$33,595$42,537
Debt free in46 months58 months61 months
Interest rate0%11% APR23% APR

In this example, debt relief costs $14,845 less than a debt consolidation loan and $23,787 less than making minimum monthly payments on a credit card. Even with fees.

Who is debt relief best for?

Debt relief is best for people who:

  • Owe at least $7,500 in debt
  • Have trouble making repayments on that debt
  • Want to avoid bankruptcy

Most companies accept only unsecured debt for debt relief. This includes credit cards, retail store cards, personal loans and medical bills. You generally can’t use debt relief to get rid of student loan debt, tax debt or secured debt like mortgages and car loans.

But there are exceptions. Some established debt relief companies can settle private – not federal – student loans and even some secured debt. National Debt Relief is one company that is willing to work with private student loans.

How to choose a debt relief company

Debt relief has earned itself a somewhat shady reputation, thanks to a rise in scam companies in the early 2000s. Although a 2010 federal crackdown cleaned up the industry in part, scammers are always creating new ways to take your money.

Avoid a scam by weighing these nine factors when deciding between debt relief companies:

  • Accreditation. Check a company’s IAPDA certification and AFCC accreditation. Many states require legit debt relief companies to be accredited — and many also require employees to receive IAPDA training and certification.
  • Minimums and debt type. Know the minimum amount of debt you need to qualify and the types of debt that are eligible. Many companies don’t work with student loans or secured debt.
  • Federal Trade Commission bans. Confirm whether the company or the company’s CEO is on the FTC’s list of banned debt relief companies.
  • Fees. Many companies charge between 15% and 20% of your total enrolled debt in fees. Keep in mind that it’s illegal to be charged fees until the company provides results.
  • Customer reviews. Read through reviews on sites like Trustpilot and the BBB, and avoid companies with a high number of complaints.
  • Transparency. Legitimate debt relief companies spell out what you can expect on their websites, with contracts in plain language so that you know what you’re signing. Never be pressured into agreeing to something you don’t understand.
  • Availability. Some states limit or outright ban debt relief services from providing services. Confirm that any debt relief company you’re interested in is licensed to operate in your state.
  • Length of time in business. It’s not failsafe, but older more-established businesses may feel less pressure to engage in unsavory business practices to stay afloat.
  • Solicitation. If the company solicited you for its services, make sure advertised promises are true. Otherwise, it’s not following government regulations.

Risks of debt relief: What to look out for

While offering a solution out of large debt, the process of debt relief isn’t without risks. Keep in mind these five drawbacks when weighing your options.

  • Your credit score may drop. Debt settlement can cause your credit score to dip by 100 points or more — at least until your debts are paid off. A record of your missed payments will stay on your credit report for seven years, which can affect your ability to get credit.
  • Your debt amount may go up. When you begin sending money to the debt relief company instead of your creditors, fees and interest will accrue on your accounts. If you don’t follow through with your debt settlement program, you’re responsible for these charges.
  • Your creditors could reject negotiation. If the creditor rejects the debt relief company’s settlement, you could end up owing more than originally planned. Creditors are not legally obligated to negotiate.
  • You will pay taxes on your settled debt. The IRS considers settled debt to be taxable income. Fees and interest that accumulate while you’re in the program can eat into what you save through the program.
  • Program completion takes work. Only around 10% of people who enroll in debt relief actually complete the program. Keep track of your progress to stay motivated toward your goal: paying off your debt.
1 - 3 of 3
Updated regularly
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.
Go to site
More Info
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.
Go to site
More Info
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.
Go to site
More Info
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Narrow down top debt relief companies by fees, minimum balances and more to find the best for your budget and financial goals. Select Compare for up to four products to see their benefits side by side.

Alternatives to debt relief

Debt relief alternatives can take more effort to find and apply for, but they may provide a softer landing with less damage to your credit.

Debt consolidation loans

Debt consolidation involves taking out a personal loan to pay down debt. These loans are best for someone with a credit score above 670 who needs more than a year to pay it down, but owes less than 50% of their gross annual salary. Depending on your credit, consolidation may not necessarily get you a lower rate, but it can significantly cut down on the number of bills you need to pay every month.

DIY debt negotiation

Be your own advocate and negotiate down your balances or ask for stronger terms from your creditors. While you won’t have as much experience as a professional, you’ll avoid potential scams and know that you have your own best interests in mind.

Nonprofit credit counseling

Some credit counseling companies are free, because the Department of Justice requires it for those who enroll in credit counseling as a part of bankruptcy proceedings. For credit counseling or debt management, you might pay a monthly fee of around $35.

Look for a nonprofit agency or explore the DOJ’s list of approved credit counselors to talk with a low-cost or free agency near you.

Government debt relief programs

The federal government offers debt relief programs for federal loans and mortgages that can help slash or reduce your debts.

  • Making Home Affordable. A government mortgage assistance program that can help reduce the amount you owe. This program is also called HAMP, HAFA and HARP.
  • Federal student loan forgiveness. Forgiveness programs like Public Service Loan Forgiveness and Teacher Loan Forgiveness allow you to wipe out all or part of your debt in exchange for working in public service for several years.
  • Government grants. Low-income individuals might qualify for a government grant to cover costs — especially if you’re faced with unexpected expenses and debt.

Bankruptcy

This is an option of last resort. With bankruptcy, you can either declare bankruptcy yourself or use legal representation to help you navigate the bankruptcy process.

For more information on how to handle your own debt, read our step-by-step guide to settling debt without an expert.

Frequently asked questions

Can a debt relief company help me with loans I’ve defaulted on?
Possibly. If you’ve recently defaulted on a personal loan, a debt relief company may be able to help you get out of default and begin making on-time payments again. If your loan is in collections, the company may be able to help you negotiate a settlement.

Should I try debt settlement or file for bankruptcy?
It depends on your situation. If you’re able to settle your debts, it can have a less drastic impact on your credit score. However, if you fail to settle your debts and have to file for bankruptcy anyways, you could end up in worse shape than if you’d gone straight to bankruptcy. Read our guide on debt settlement versus bankruptcy to learn more about how to decide.

How long will a debt settlement stay on my credit report?
Debt settlement will stay on your credit report for seven years from the date the debt was settled.

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  1. What are debt settlement/debt relief services and should I use them?, CFPB, 24 Aug 2022
  2. Debt relief services and the Telemarketing Sales Rule, FTC
  3. IAPDA accredited service centers, IAPDA
  4. Companies and People Banned From Debt Relief, FTC
  5. AFCC members, AFCC
  6. List of credit counseling agencies approved pursuant to 11 U.S.C. § 111, DOJ

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