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Published: Apr 29, 2024 24 min read

Money’s main takeaways

  • We recommend debt relief only when other, more favorable options are not viable. Debt consolidation loans and credit counseling make better financial sense for borrowers.
  • Debt relief companies require you to stop paying creditors in order to increase their negotiating power. This will almost certainly have a negative impact on your credit score. The upside is that a debt relief program can enable you to settle your accounts for less than you owe.
  • Debt relief can help you avoid bankruptcy, but there is no guarantee your creditors will accept the settlement proposed by the debt relief company.
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Debt relief, or debt settlement companies, are services that claim they can negotiate with creditors to reduce the amount of debt owed by their clients. Debt relief is not without controversy, and there are risks you need to be aware of.

If you owe a large sum of money at high interest and have had no luck with other debt consolidation methods, you might want to consider using a debt relief company. Read on to learn about the best debt relief companies.

Our Top Picks for Best Debt Relief Companies of May 2024

The companies listed below are organized alphabetically.

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Best Debt Relief Companies Reviews


Pros
  • Programs can take as little as 24 months
  • No charge until you've received results
  • Multiple debt relief options available
Cons
  • Fees can amount to 25% of enrolled debt
  • Cannot track progress online like some competitor platforms
  • Not available in every state
HIGHLIGHTS
Debt management available
Yes
Debt settlement available
Yes
Additional services offered
Debt consolidation loans
Settlement fees
15%-25% of enrolled debt

Why we chose it: Accredited Debt Relief offers some of the quickest results among all the services we evaluated. Though the timeframe to become debt free will depend on your particular debt situation, the company can get you out of debt in as little as 24 months.

Accredited also offers a free consultation where you can speak with a specialist who will help you decide if debt settlement is the right option for you. If it turns out not to be, Accredited can connect you with one of its consolidation loan affiliates. Affiliate consolidation loans range from $1,000 to $100,000 and have APRs that range from 6% to 36%.

Read our full review of Accredited Debt Relief.

Learn more on Accredited Debt Relief's Secure Website.


Pros
  • Staff includes licensed tax practitioners, IRS enrolled agents and CPAs
  • Free consultation
  • Available in all 50 states
Cons
  • Minimum debt requirements not disclosed
  • Doesn't list prices online
HIGHLIGHTS
Debt management available
No
Debt settlement available
No
Additional services offered
Tax resolution, tax preparation, tax assurance
Settlement fees
N/A

Why we chose it: Community Tax is your best bet for negotiating tax debt because the company employs a team of professionals who have a long history of dealing with the IRS.

Community Tax employs a robust team of licensed tax practitioners, enrolled agents and CPAs to help you settle your debt with the IRS. The company also offers services such as tax planning, tax preparation and bookkeeping, not to mention a free tax analysis.

Read our full review of Community Tax Relief.

Learn more on Community Tax's Secure Website.


Pros
  • Free, expert consultation
  • No upfront fees
  • Online progress tracker available 24/7
Cons
  • Fees range from 15% to 25% of enrolled debt
  • Not available in all states
  • No live chat customer support online
HIGHLIGHTS
Debt management available
No
Debt settlement available
Yes
Additional services offered
Debt consolidation loans
Settlement fees
15%-25% of enrolled debt

Why we chose it: While other debt relief companies offer free consultations, Freedom Debt Relief has the most comprehensive no-risk evaluation of all the services we considered.

If you’re considering debt relief, but are still on the fence, Freedom’s certified debt consultants can help you make an educated decision. If they feel your particular situation warrants debt relief, they’ll explain the money you could expect to save, and the estimated timeframe of the debt relief process.

This is an attractive option because it allows prospective customers to get a ballpark idea of what they can expect if they decide to go with the debt relief option.

Read our full review of Freedom Debt Relief.

Learn more on Freedom Debt Relief's Secure Website.


Pros
  • High customer satisfaction ratings
  • No fees until accounts are settled
  • Arbitrators are IAPDA accredited
Cons
  • Fees can amount to 25% of enrolled debt
  • No mobile app
  • Not available in every state
HIGHLIGHTS
Debt management available
No
Debt settlement available
Yes
Additional services offered
Debt consolidation loans, credit counseling, bankruptcy referrals
Settlement fees
15%-25% of enrolled debt

Why we chose it: National Debt Relief has a solid reputation and history that shows in literally tens of thousands of positive online reviews.

National Debt Relief claims to have helped over half a million people get out of debt since the company was established in 2009. This is attested to by a multitude of five-star reviews across such sites as Trustpilot and Google.

New York-based National Debt Relief claims to have helped over half a million people get out of debt since the company was established in 2009. This is attested to by a multitude of five-star reviews across reputable third-party review sites.

Additionally, the company is accredited by the American Association for Debt Resolution (AADR) and Platinum Accredited by the International Association of Professional Debt Arbitrators (IAPDA). Customers have also given positive feedback on third-party review sites.

Read our full review of National Debt Relief.

Learn more on National Debt Relief's Secure Website.


Pros
  • Founded in 1999
  • Fees are not charged until a settlement agreement has been made
  • AFCC accredited
Cons
  • Not available in three states
  • Minimum debt not disclosed
HIGHLIGHTS
Debt management available
No
Debt settlement available
Yes
Additional services offered
Free debt analysis
Settlement fees
15% - 25% of enrolled debt

Why we chose it: Out of all the debt settlement services we evaluated, New Era Debt Solutions has the longest service history.

New Era could be a viable option for customers who feel more comfortable with a provider that has a long track record. Since 1999, the company has been employing debt relief attorneys and negotiators to help customers pay off their unsecured debt for less than they owe.

On third-party review sites, customers praise New Era Debt Solutions representatives for their helpfulness in answering questions about the debt relief process. Some reviewers claimed their debts were cut in half and settled within the timeframe proposed by the company. On one consumer review site, New Era Debt Solutions has an A+ grade and a rating of 4.73 out of 5 stars, which is based on more than 3,500 reviews.

Additionally, consultants, resources and services are all available in Spanish.

Learn more on New Era's Secure Website.

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Free, personalized evaluation

Free, personalized evaluation from certified debt consultants

  • Over 850,000 clients have enrolled in the Freedom Debt Relief program since 2002
  • American Fair Credit Council accredited
  • Settled over $15 billion in client debt since 2002
  • Recommended for people with $15,000 in unsecured debts and up
  • No upfront fees

Fast and easy application process

Our #1 Choice: Free consultation, 100% Confidential

  • Fast and easy application process
  • No upfront fees
  • One-on-one evaluation with a debt coach
  • Become debt-free in 24 to 48 months
  • For people with $7,500 in unsecured debts and up
  • Rated A+ by Better Business Bureau
  • AFCC Accredited

Serving customers with $15,000 of debt

Serving customers with $15,000 of debt and more

  • 100% free, no risk consultation
  • Significantly reduce your debt
  • No upfront enrollment fees
  • Get out of debt in 24-48 months!
  • Applying won’t affect your credit score
  • A+ Better Business Bureau rating

30+ years experience in financial services

Customized options to fit your needs

  • 100% FREE initial consultation
  • One affordable monthly program payment
  • 30+ years experience in financial services
  • Ideal for consumers with $15,000 or more in debt

Consolidation Loans Up to $100,000

Consolidation loans up to $100,000

  • Ideal for consumers with over $10,000 in unsecured debt
  • Flexible repayment terms with your budget in mind
  • Free quotes are offered
  • “A” Rated by the BBB
  • Reviewing offers won't impact credit
  • Easy pre-approval process with instant decision

Other debt relief companies we considered


JG Wentworth Debt Relief

Pros
  • 30 years experience
  • Great customer reviews
Cons
  • Not transparent about the downside to debt relief programs
  • Website short on information
  • Fee structure not clear

JG Wentworth is best known for its structured settlement business, but the company also provides debt relief services. It also has very positive reviews on multiple consumer websites.

However, while JG Wentworth is transparent in disclosing that creditors are under no obligation to negotiate, there is no mention on the website about the likely effects debt settlement will have on your credit and financial health. What’s more, it’s not clear what fees JG Wentworth will charge, or the minimum and maximum debt they can accommodate.

Learn more on JG Wentworth Debt Relief's Secure Website.


Pacific Debt Relief

Pros
  • Free consultation
  • Helps with many kinds of unsecured debt
Cons
  • Need more than $10,000 in unsecured debt
  • Not available in every state

Pacific Debt Relief helps qualified applicants consolidate and reduce their debt by up to 50% and can help settle multiple types of debt, including credit card debt, student loan debt, medical debt, business debts, personal loans, payday loans and more. To qualify, customers must have a minimum of $10,000 in unsecured debt. However, Pacific Debt Relief is less accessible than competitors, as customers don't have an online account or portal.

Learn more on Pacific Debt Relief's Secure Website.


CuraDebt

Pros
  • Tax relief services available
  • No upfront fees
Cons
  • Out-of-date website
  • Debt relief services not available in every state

CuraDebt helps customers with the debt settlement of credit cards, lines of credit, personal loans, medical bills, business debts, some secured debts, back taxes and IRS debt. While CuraDebt’s tax debt relief services are available in every state except Pennsylvania, its other debt relief services are unavailable in 15 states.

CuraDebt doesn’t charge monthly or upfront fees. Its website states that its costs are 20% or less of the total amount of debt on average.

Learn more on Curadebt's Secure Website.


DMB Financial

Pros
  • Free consultation
  • Over $1 billion in debt managed
Cons
  • Recent legal trouble with CFPB for unlawful fees
  • Doesn't list prices online

DMB Financial is a debt settlement company that will work with your creditors to help you restructure your debt and create a manageable time frame for debt repayment. The company offers a free consultation through one of its certified program consultants. However, DMB Financial doesn’t list prices for its services online.

The Consumer Financial Protection Bureau (CFPB) filed a lawsuit against DMB Financial in December 2020 for charging consumers unlawful fees, which resulted in a $5.4 million penalty.

Learn more on DMB Financial's Secure Website.


Simple Debt Solutions

Pros
  • Prioritizes consolidation loans
  • Large lender network
  • Settlement services available
Cons
  • Limited online resources
  • Loan rates can be as high as 35.99%

Simple Debt Solutions is a marketplace that specializes in debt consolidation loans, but also offers other debt relief services. Primarily, Simple Debt Solutions connects prospective borrowers with its large network of lenders in order to find them the best deal. This is noteworthy, as a debt consolidation loan is always a better financial option to debt settlement if the customer is able to qualify.

For those who cannot qualify, Simple Debt offers debt settlement and other debt consolidation options. On one third-party review site, the company has positive customer feedback, and on another consumer website, has received an A+ grade.

Learn more on Simple Debt Solutions's Secure Website.


Debt Relief Guide

Before deciding on a debt relief company, you should understand how debt relief works, the pros and cons and all the options available to you. This guide will help you make the best decision.


What is debt relief?

Debt relief, also called debt settlement or debt resolution, is the overall reorganization or restructuring of your high interest debt when you are struggling to make on-time payments.

Debt relief companies will assist you in getting out of debt by negotiating with your creditors, but you may face negative consequences depending on your financial situation.

Some signs that you may want to consider debt relief include:

  • You’re late on or missing payments
  • You’re having trouble budgeting for your payments
  • You’re not making any progress on paying off your debts
  • Your debts continue to accumulate
  • You’re considering bankruptcy

To learn more about debt relief, read our full guide to debt relief.

What is a debt relief program?

A debt relief program is a plan, usually created by a debt relief or debt settlement company, to help you pay off your debt by negotiating with creditors to get them to accept less than the amount they are owed.


How does debt relief work?

When you start the debt relief process, the company will generally instruct you to stop paying your creditors. Instead, you will pay a monthly fee to the debt relief company directly and they will put your funds into a dedicated savings account. As the money in the account accumulates, the debt relief company will begin negotiating with your creditors.

Essentially, the debt relief company uses the fact you have stopped paying your accounts as leverage. Faced with the prospect of receiving nothing, the creditor will agree to accept a smaller amount paid in a lump sum from your dedicated bank account. Next, the creditor will likely close the account and it will appear on your credit report as “settled.”

Debt relief companies can only charge you once the settlement terms have been established with the creditor and a clear path forward is laid out. They usually charge a fee of 15% to 25% of your total debt, also known as your enrolled debt. While this percentage might seem high, considering a debt relief company can reduce your debt by up to 50%, it often ends up being less than your original debt amount.

Indeed, debt relief can be an appealing option to get out of debt. However, there are important downsides to consider.

Does debt relief hurt your credit?

Debt relief will almost certainly hurt your credit. Payment history is the biggest factor the credit bureaus consider when determining your credit score. When you stop paying creditors, you will be dinged for late and missed payments.

Also, if your creditors close your accounts, it will negatively affect your credit utilization ratio, which is the second most important factor in determining your credit score. Closed accounts marked as “settled” means the creditor had to alter the conditions of the initial agreement.

Debt settlement can also take months if not years. The entire time the company negotiates with your creditors, you will still incur late fees and likely receive harassing phone calls.

Finally, there is no guarantee a given creditor will accept a debt relief company’s settlement offer, which could lead to a debt collection lawsuit.

Differences between debt settlement and debt consolidation

Debt consolidation refers to the process of applying for a personal loan or balance transfer credit card with better rates and more favorable terms than your current debt structure. Your debts are then transferred to the new account and you make one monthly payment.

Debt consolidation simplifies your personal finances and will generally improve your credit in the long run if you keep current on payments and don’t incur more debt. With debt consolidation, you still pay the entire amount you owe, ideally in a shorter time with less interest.

Debt settlement

Debt consolidation

Stop paying creditors and negotiate with them to take less than the full debt amount

High interest debts are combined into a loan or transferred to a credit card with a lower interest rate

15-25% of the settled debt

Interest rates vary. Some loans and credit cards have fees

It will harm your credit. Negative marks can remain on your report for years

Credit score can lower initially because of the hard pull, but if used responsibly, it can improve credit in the long run

You could pay less than you owe and eliminate debts

Save money on interest, simplify payments, improve credit score and financial health

There is no guarantee creditors will agree to the terms provided by the debt settlement company. Stopping payments and closing accounts could significantly hurt your credit score

You need average to good credit to qualify for the most favorable terms. Also, if you choose a credit card transfer, the APR could change after an introductory period

If you’d like to learn more about consolidation, check out Money’s debt consolidation guide.

Pros and cons of debt settlement

PROS

  • Pay less: If the debt settlement company is successful, they could negotiate an amount significantly less than you owe, even with their fees.
  • Pay faster: With debt settlement, you can eliminate your debt more quickly than continuing to pay monthly minimums.
  • Avoid bankruptcy: Bankruptcy arguably has more far reaching effects than debt settlement.
  • Avoid lawsuits: If the creditor agrees to the terms the account will be settled, and they will cease legal action.

CONS

  • Credit score will drop: Late payments, missed payments and closed accounts marked “settled” can all significantly damage your credit and will last for years.
  • Creditors may not negotiate: There is no guarantee your creditors will accept the debt relief company’s settlement, leaving you with more debt considering late fees and penalties, not to mention the potential of a lawsuit.
  • Must keep up on payments: You must be able to make monthly payments to the debt settlement company to stay in the program. If you can’t, you will have to withdraw, leaving you in a worse place than you started.
  • Scams: The debt settlement industry is rife with bad actors. Beware of guarantees of success and anyone who asks for money up front.

Is debt relief right for you?

Because of its impact on your credit score and associated risks, employing a debt relief company is not for everyone. Getting a debt consolidation loan, a balance transfer credit card or working with a credit counselor or other debt management program is preferable.

However, if you are overwhelmed by debt, can’t keep up with payments and cannot secure a loan or credit card with a more favorable rate due to an already low credit score, debt settlement may be a viable option for you.

Below, we’ll discuss some of the alternatives to debt relief programs.


Alternative options to debt relief programs

There are several other options you should consider before employing the services of a debt relief or debt settlement service. Some of these will be less risky and less likely to negatively impact your credit score. In fact, many of them can have a positive effect in the long run.

These options include credit counseling, debt management, debt consolidation loans, negotiating with lenders yourself and bankruptcy.

  • Debt management - A credit counseling agency may help you set up a debt management plan. This plan could involve the counselor negotiating directly with creditors on your behalf to lower interest rates, waive fees and minimize payments.
  • Debt consolidation loans - A debt consolidation loan is a personal loan that combines and consolidates other high interest debts into one monthly payment. Ideally, the loan rate will be lower than your current debts allowing you to pay less in the long run.For more information, check out our top picks for the best debt consolidation loans.
  • Negotiate with creditors - It is possible to negotiate with each of your individual creditors yourself. Essentially, you are doing the same thing as the debt settlement agency, only without the experience and negotiating muscle. It also requires determination, follow up and a lot of hard work on your part.
  • Negotiate with debt collectors - If your debt has been sold, you may be able to negotiate with the debt collector. And since debt is usually acquired at a significantly reduced value than its original amount, you have the opportunity to engage with the collection agencies and find a middle ground between your initial debt and the price they paid for it.
  • Bankruptcy - Filing for bankruptcy isn’t something to take lightly. You can use bankruptcy to help with your debt problems, but it will have a significant impact on your credit report.

How to choose a debt relief program

Selecting a debt relief company requires careful consideration. Thorough research is essential, as even legitimate companies need to be vetted.

Beware of potential scams: Be cautious if a provider guarantees debt reduction or asks for upfront fees or set-up fees before providing services; these are red flags.

When choosing a debt relief company, consider these factors:

  • Reputation and accreditation - Legitimate debt relief or debt settlement companies will be recognized by the American Fair Credit Council (AFCC), so look for this accreditation on the company’s website or inquire with a representative. The AFCC is an organization that monitors and holds companies to the highest standards and also educates consumers on the subject of debt resolution.
  • Customer Reviews - Review customer feedback on the Better Business Bureau (BBB), Trustpilot and other trustworthy sites. Occasional bad reviews are typical, but consistent negative patterns signal concern. Assess how the company addresses complaints; active engagement and resolving issues indicate reliability.
  • Fees - By law, debt relief companies cannot charge upfront fees. They can only charge you once creditors agree to the settlement. Avoid companies requesting money upfront. Verify fees and payment details before committing. Typically, debt settlement companies charge a percentage of the settled debt; confirm this with a representative in advance.
  • Accessibility - How easy is the company to get a hold of? Given the impact a debt settlement program could have on your financial health, you should be able to contact the provider on the phone or through chat, email or text, and they should be responsive to your questions. It is also a bonus if they have an online dashboard where you can monitor your progress.

How to apply for a debt relief program

As debt relief comes in many different forms, applying for debt relief will depend on which option you decide to pursue. If you decide to get assistance from a debt relief company, your debt relief will depend on your eligibility for one of their programs. You can also try to get debt relief by consolidating your debts, speaking directly with your lender or declaring bankruptcy.

Debt Relief Companies FAQs

Are debt relief programs legit?

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Although debt relief programs can be legitimate, there are scams and fraudulent organizations present in the industry. Avoid any entity that offers guarantees or charges you up front. Only opt for a certified debt settlement company.

If a debt settlement company is following proper procedure, they will not charge you until an agreement has been made with your creditors and will be transparent about what you can expect from the process. Also, remember that a debt settlement plan will most likely have a negative impact on your credit score.

It’s important to point out that debt relief companies typically cannot help with federal student loans, private student loans, auto loans or any other secured debts with collateral attached.

Does debt relief hurt your credit?

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Debt relief can affect your credit depending on which type of relief you use. Filing for bankruptcy or using a debt settlement company can negatively impact your credit report. Alternatively, using debt relief methods such as debt consolidation may improve your credit if you make monthly payments on time.

Is debt relief a good idea?

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Debt relief may be a good idea for people who are struggling or unable to repay their debts. A debt relief company might negotiate a favorable settlement with your creditors. However, there are downsides, including hurting your credit score. To find out if debt relief is a viable option for you, consult with a reputable debt relief company. Discuss your specific situation and be sure to ask about fees and potential outcomes.

What is the best debt relief company?

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The best debt relief company is transparent about the debt relief process, including the company’s fees, program timeline and potential outcomes. Note that a good debt relief company will not charge you upfront fees (this is illegal) and will not guarantee results, as it’s up to the creditors to decide whether or not they will accept a settlement offer.

How We Chose the Best Debt Relief Companies

We analyzed the top debt relief companies available to support our recommendations. To decide which companies were best, we employed the following methodology:

  • Costs: We chose debt relief companies that provide the best services for their given cost. Companies generally charge 15 - 25% of the debt they settle for you. By law, they cannot charge you anything up front and can only begin charging once the creditor has accepted the settlement.
  • Customer support: We highlighted companies that are responsive to customers and offer assistance via phone, email, text and online form. Companies that offer the ability to track the debt settlement process via an online dashboard or mobile app fared well with us, too.
  • Legal actions: We researched legal actions via the Consumer Financial Protection Bureau (CFPB) and news outlets. Companies with a pattern of legal issues or unsettled legal actions were disqualified from our list.
  • Services and offerings: We favored companies that give you the most options when it comes to debt settlement. Most services will be able to work with credit card and unsecured personal loan debt, but it’s less common for them to offer help with medical bills, utility bills, rent and judgments.
  • Third-party ratings: We looked at trusted third-party rating sites to determine how satisfied previous customers were with each service. We considered BBB accreditation and how likely the company was to respond to complaints in a productive way. We also considered the percentage of successfully closed complaints. Additionally, we took a look at other customer review websites specific to the debt relief industry in order to identify any pattern of similar complaints lodged against a given company.
  • Transparency: We only considered programs that are transparent about their pricing structure and don’t trick you with hidden fees.
  • Third-party ratings: We analyzed trusted third-party rating sites to determine how satisfied previous customers were with each service. We considered Better Business Bureau (BBB) accreditation and how the company responds to and successfully closes complaints.

Companies we considered for Best Debt Relief

Accredited Debt Relief, American Consumer Credit Counseling, Americor Debt Relief, Apprisen, Atlas Debt Relief, Century Debt Relief, Century Support Services, Community Tax, Credit Associates, Debt Blue, Financial Debt Relief, Financial Future Debt Relief, Freedom Debt Relief, JG Wentworth, Liberty Debt Relief, Money Management International, National Debt Relief, New Era Debt Solutions, Umbrella Debt Relief

Summary of Money’s 5 Best Debt Relief Companies of May 2024

The companies listed below are organized alphabetically.