Tips for Choosing a Debt Relief Company
- The best debt relief companies are transparent about their fees.
- Research a debt relief company online to check its reputation and reviews.
- The Association for Consumer Debt Relief (ACDR) is an industry accreditation organization that sets standards for member debt relief companies.
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Free up cash each month with Freedom Debt Relief
Ozzy S., Freedom client²
“Right away, I had more money each month because of program costs so much less than what I was paying on my minimums.”
You have a lot of options when it comes to debt relief, from the method you use to the debt relief company you choose. Having all those choices is great—except when you're not sure how to pick the right one.
The key to making the right choice is to know exactly what you want out of your debt relief company.
Here are our expert tips about debt relief options, as well as on how to find the best debt relief company to make it happen.
Choosing the Right Debt Relief Option
The first thing to do is figure out what type of debt relief help you need, which means choosing your debt relief method. Here's a quick look at your basic debt relief programs.
Debt consolidation/refinancing
Refinancing and consolidating your credit card debt under a new loan with a lower interest rate could lower your monthly payment and simplify the repayment process.
Most people use a personal loan or a home equity loan for debt consolidation. The repayment term on a personal loan is typically two to 10 years. For a home equity loan, you might have 10 to 30 years to repay the loan.
Debt consolidation could be an option if you qualify for a new loan with a lower interest rate than you currently pay, and you can afford the monthly payment.
Debt management plan
You could enroll in a debt management plan (DMP) with a credit counseling agency, a nonprofit that helps you with financial education, budgeting, and organizing your debt if you sign up for their debt payoff program.
A DMP consolidates your unsecured debt (mainly credit cards), and the credit counselor can negotiate with your creditors to reduce your interest rates and fees. Once the debt management plan is set up, you'll make one monthly payment to the counseling agency, which will then pay your creditors.
A DMP is designed to fully repay all of your unsecured debts in three to five years, so the payment could be high. This could be a route to consider if you can afford to repay your debts but you need some guidance and structure.
Creditor hardship programs
Many creditors offer hardship programs that could help you deal with debt if you’re experiencing a financial hardship. Common financial hardships include job loss, divorce, the death of a loved one, or severe illness or injury.
A creditor hardship program may include:
Reduced interest rates
Loan extensions
Payment forbearance
Fee waivers
For best results, contact your creditor as soon as you realize you may have trouble making your payments.
Ask whether interest will continue to accrue even if you’re allowed to skip payments (it probably will). Also find out if you'll eventually need to get caught up on all missed payments. This could be a hardship. For example, if you are given a three month payment break and in month four you’re expected to make a giant four-month payment, it’s good to know that ahead of time.
Hardship programs could be an option if your struggles are expected to be temporary.
Debt settlement
Debt settlement means negotiating with your creditors to accept less than you owe to get rid of your debts.
You could negotiate with your creditors for debt settlement on your own. Be prepared for multiple rounds of communication with each creditor. Also, you’ll need money to offer. Creditors don’t typically forgive all of your debt, but rather a percentage of it.
Alternatively, you could hire a professional debt settlement company to work on your behalf. An experienced debt settlement company may be able to settle your debt faster and for less than you could do on your own. For example, you might look into how Freedom Debt Relief works.
Debt settlement is an option to consider if you can’t afford to fully repay your debts.
Bankruptcy
Filing for bankruptcy could be an effective debt relief option if you need legal protection from your creditors. All kinds of bankruptcy put an immediate (but temporary) stop to collections efforts, including mortgage foreclosure.
If you qualify for Chapter 7 bankruptcy and have a lot of unsecured debt, like credit card debt, bankruptcy could get rid of your debt faster and for less money than other strategies.
Chapter 7 bankruptcy is known as liquidation bankruptcy. A successful Chapter 7 bankruptcy can eliminate most or all of your unsecured debt. You might be forced to give up some valuable things you own. For example, you generally wouldn’t be allowed to own multiple cars. You can keep a modest vehicle, but the others would be sold and the money given to your creditors. To qualify for Chapter 7, your income must be low enough that you can’t afford a payment.
If your income is higher, you could choose Chapter 13 bankruptcy. This is the reorganization bankruptcy, also known as a structured repayment plan.
It’s usually a good idea to hire a bankruptcy attorney to help you with the process. People who self-represent in bankruptcy have a lower success rate.
Factors to Consider When Choosing a Debt Relief Company
Sorting the good debt repair companies from the bad takes a bit of research. Here's what you should consider when comparing your options for debt relief companies.
Services
First, make sure the debt relief company you choose actually offers the services you need. Not all debt relief companies offer the same services, so check out websites or set up consultations to find out what each company has to offer.
Fees and costs
Any debt relief company worth your time will be transparent about its fees and payment structure. Make sure the costs are in line with your budget and won't add to your overall debt load.
Compare fees from several companies to get an idea of the average cost for services. This will give you a sense of which companies are being fair—and which ones to steer clear of.
Experience and reputation
You want a debt relief company that knows what it's doing and has a strong reputation for doing it well. Look into the company's history to find out how much experience it actually has dealing with your situation.
You can check with business organizations, like the Better Business Bureau (BBB), to learn more about the company's ranking and history of complaints. A company's status with applicable certification and accreditation boards, such as the Association for Consumer Debt Relief (ACDR), can also give you an idea of the company's reputation.
Customer service and communication
What good is a debt relief company if you can't get in touch with them? Choose a responsive company that answers your questions in a friendly, helpful way—and within a reasonable amount of time.
Check out the company's contact page, FAQs, and other resources to make sure you'll be able to get answers when you need them.
Success rates and reviews
Who knows a company better than the customers who have used it before? Check out online reviews, on Trustpilot or other sites, and ask friends or family for their experiences with debt relief companies when choosing your own. Look for a company with a long history of successfully helping people manage their debt.
Red Flags to Watch Out for When Choosing a Debt Relief Company
If a debt relief company waves red flags, it's time to look elsewhere. Here are some signs a debt relief company is predatory or running a scam.
Pushy or aggressive sales tactics
A good debt relief company wants to help you, not grift you. It’s an immediate red flag if you feel bullied into agreeing to something you're uncomfortable with or you’re being asked to pay money for services you don't want.
Upfront or excessive fees
Debt relief services aren’t free, but they shouldn't be so expensive that they make your debt problem worse. The first consultation should be free.
If you're looking specifically at debt settlement, remember that debt settlement companies aren't allowed to charge any upfront debt settlement fees. At Freedom Debt Relief, our expert negotiators first work out an agreement with your creditor. Then we present the details to you for your review and approval.
After you approve, the first payment (sometimes the only payment) is paid to your creditor from a dedicated account that was previously set up. Only after all of these things happen do we charge our fee. Take a look at the Freedom Debt Relief FAQs.
Promises or guarantees of success
No debt settlement company is allowed to make promises or guarantees about:
Being successful. There are few certainties in finance, and no debt relief company can promise results. Any company that swears it'll disappear your debt is more likely to disappear your money.
Settling your debt overnight. Any kind of debt relief, including debt settlement, takes time. Be wary of too-fast-to-be-true promises.
Getting rid of your debt for pennies. Avoid companies that promise to save you a certain amount of money or claims you'll pay pennies on the dollar for your debt.
Stop collection calls and lawsuits. Debt repair companies can't stop or prevent lawsuits or stop collection agencies from calling you about debts you owe.
If something sounds sketchy, it probably is. Trust your instincts.
Lack of transparency
You don't want a company that isn't honest and upfront with you about services, fees, and potential results. A debt relief company that keeps you in the dark probably isn't looking out for your best interests.
Poor customer reviews
A few bad reviews are part of doing business, but if the majority of the customer feedback online is complaints, that's a sign that you probably won't get the results you're after. Sites like the BBB can help you find user reviews.
No industry accreditation
Most legitimate debt relief companies will likely be a member of an industry accreditation organization, such as the Association for Consumer Debt Relief (ACDR). The ACDR sets specific standards for its members and advocates on behalf of the debt relief industry.
Not licensed in your state
Any legitimate debt relief company doing business in your state will be licensed with the appropriate state government division. This is typically called the Department of Financial Services, though the specific designation may vary. You can perform an internet search for your state to find the correct website.
Steps to Take Before Choosing a Debt Relief Company
Choosing the right debt relief company is a big decision, so take your time deciding. Here are some steps to take before picking a company:
Check for complaints. The Consumer Financial Protection Bureau (CFPB) Consumer Complaint Database lets you read complaints filed by consumers.
Schedule consultations. Most debt relief companies should offer a free consultation to discuss your options.
Ask questions about the process. Make sure you're entirely comfortable with how everything will work before you agree to anything.
Review contracts carefully. Read through all of the fine print, even if it's boring. If you don't understand something, ask for clarification.
Everything about the process should be at your pace. Don't let anyone bully you into making a decision before you're ready.
Looking for debt relief in Florida or across the country? The first step is the most important one—explore your options.
A look into the world of debt relief seekers
We looked at a sample of data from Freedom Debt Relief of people seeking the best debt relief company for them during September 2026. This data highlights the wide range of individuals turning to debt relief.
FICO scores and enrolled debt
In September 2026, the average FICO score for people enrolling in a debt settlement program was 587, with an average enrolled debt of $24,514. For different age groups, the FICO scores varied. For instance, those aged 51-65 had an average FICO score of 588 and an enrolled debt of $26,311. The 18-25 age group had an average FICO score of 546 and an enrolled debt of $15,029.
No matter your age or debt level, it's reassuring to know you're not alone. Taking the step to seek help can lead you towards a brighter financial future.
Collection accounts balances – average debt by selected states
Collection debt is one example of consumers struggling to pay their bills. In September 2026, 30% of debt relief seekers had a collection balance. The average amount of open collection account debt was $3,203. Here is a quick look at the top five states by average collection debt balance:
Collection accounts - top 5 states
| State | % with collection balance | Avg. collection balance |
|---|---|---|
| District of Columbia | 23 | $4,899 |
| Montana | 24 | $4,481 |
| Kansas | 32 | $4,468 |
| Nevada | 32 | $4,328 |
| Idaho | 27 | $4,305 |
The statistics are based on all debt relief seekers with a collection account balance over $0.
If you’re facing similar challenges, remember you’re not alone. Seeking help is a good first step to managing your debt.
Regain Financial Freedom
Seeking debt relief can be the first step toward financial freedom. Are you struggling with debt? Explore options for debt relief to regain control of your finances. It doesn't matter how old you are or what your FICO score or credit utilization is. Take the first step towards a brighter financial future today.
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Author Information
Written by
Brittney Myers
Brittney is a personal finance expert and credit card collector who believes financial education is the key to success. Her advice on how to make smarter financial decisions has been featured by major publications and read by millions.
Reviewed by
Kimberly Rotter
Kimberly Rotter is a financial counselor and consumer credit expert who helps people with average or low incomes discover how to create wealth and opportunities. She’s a veteran writer and editor who has spent more than 30 years creating thousands of hours of educational content in every possible format.
Frequently Asked Questions
How do I know if a debt relief company is legitimate?
Legitimate debt relief companies are transparent about their process, don't charge settlement fees upfront, and offer free consultations. They also leave you in control of the process, asking you to approve or deny settlement offers.
First-hand referrals are often the best way to find a legitimate debt relief company. You can also do a thorough internet search of the company's history and reputation. Online reviews and consumer ratings can be helpful here. It might also be useful to check for membership in industry organizations, such as the Association for Consumer Debt Relief (ACDR), as well as look up the company's license to operate in your state.
What is the best debt relief strategy for me?
The best debt relief strategy for you will depend entirely on your unique circumstances, including your credit history and existing debt. To choose a debt relief strategy, research all of your options and crunch the numbers. Figure out which method will best fit your budget and your financial goals. If you're still unsure, consider contacting a debt relief expert.
Is it a good idea to get a debt relief company?
It could be, but it depends on your situation. Most types of debt relief can be done on your own, but they require persistence and commitment. If you don't want to DIY your debt relief, you may have success hiring an experienced debt relief company to work on your behalf.
What is debt relief?
The type of debt relief Freedom Debt Relief offers is known by several names: debt resolution, debt negotiation, and debt settlement. Debt relief allows you to resolve your unsecured debt by negotiating with creditors and reducing the amount you owe. You could negotiate with your creditors on your own or use a debt relief program like Freedom Debt Relief to help you settle your debt.
During the debt relief process, you usually stop paying your creditors and start saving money in a special purpose account you will use to settle your debt. Once enough money is saved, either you or the debt relief company you hired contacts your creditors to negotiate a new debt amount that is lower than you currently owe.
How do I choose a good debt relief company?
Check for a debt relief company that's transparent about the types of debt it accepts, gives you a realistic timeline, and offers a realistic estimate of potential savings. Confirm the company only charges fees after it settles a debt, since federal law prohibits upfront settlement fees. Verify its state license and Better Business Bureau rating before you enroll.
Are debt relief companies legitimate?
Many debt relief companies are legitimate, and some aren't. Research a company's licensing, accreditations, and complaint history before you commit to a program. Freedom Debt Relief helped found the American Association for Consumer Debt Relief, an industry group that set standards to protect consumers from abusive debt settlement practices. We’ve worked with tens of thousands of people to settle debt.
Debt Relief
