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Debt can be a valuable tool when used wisely. A mortgage can help you move into your dream home and an auto loan can help you secure reliable transportation for work. Even credit cards can be a plus for your finances if you use them carefully. But if your debt has gotten out of control, a debt relief company can help you manage it. Using a strategy called "debt settlement," these firms can provide a path out of debt that may result in you paying less than you owe.
The debt relief companies we included in our list all have reasonable fees and positive overall reviews. To evaluate them, we followed a ranking methodology that rated firms in five key areas: Stability (5%), Reputation and Customer Satisfaction (10%), Customer Experience (7%), Services (30%), and Costs and Fees (48%).
Best Debt Relief Companies of 2023
- Best Overall: National Debt Relief
- Best for Debt Settlement: Accredited Debt Relief
- Best for Customer Satisfaction: New Era Debt Solutions
- Best Interactive Program: Freedom Debt Relief
- Best for Tax Debt Relief: CuraDebt
- Best for High-Interest Credit Card Debt: DMB Financial
Best Overall : National Debt Relief
We chose National Debt Relief as the best overall in our ranking based on its track record for results, overall transparency, and a money-back guarantee. National Debt Relief has several examples of massive reductions of credit card balances on their website, showcasing their abilities.
More than 10 years in business
Proven results settling debts for less than consumers owe
No upfront fees
$7,500+ in qualifying debts
Does not handle certain types of debts like mortgages
National Debt Relief was founded in 2009 with the main mission of helping consumers get out of debt through a reliable debt settlement program. This firm is incredibly transparent about its process and results—they share examples of what they've done for past clients on their website.
National Debt Relief helps consumers begin the process by offering a free consultation with one of its debt counselors. From there, you will have the option to explain your situation and talk over potential solutions, including using National Debt Relief for debt settlement.
Like other debt settlement programs, this company has you set aside a specific amount of money in a separate account each month, which you will later use to settle your debts for less than what you owe. In the meantime, National Debt Relief helps coordinate your efforts and negotiates with your creditors on your behalf.
You won’t pay any upfront fees to use this service, although consumers normally pay between 15% to 25% of the total debt enrolled in the program by the time their debts are settled. Generally speaking, programs from this firm last for 24 to 48 months.
Read the full National Debt Relief review.
Best for Debt Settlement : Accredited Debt Relief
Accredited Debt Relief is the best settlement option based on its proven results and success on this type of debt relief with high-interest credit card debt over $10,000.
Receive a free consultation from a Certified Debt Specialist
Save up to 40%+ on monthly payments
Plans designed for at least $10,000 of debt
Accredited Debt Relief has been in business since 2011 with the main goal of providing debt relief options to families who need them. This company boasts an array of results on its website, with plenty of former customers settling their debts for as little as 50% of what they originally owed. Accredited Debt Relief is accredited by the AFCC.
Like other debt relief companies, Accredited Debt Relief focuses its efforts on debt settlement. It starts potential clients with a free consultation with a certified debt specialist who can help them talk over their situation and options. If they are deemed a good candidate for debt settlement, Accredited Debt Relief helps them begin saving money in a separate account and stop using credit cards.
From there, the firm negotiates with creditors on your behalf, which can lead to a debt settlement that is considerably less than the amounts owed. Accredited Debt Relief also offers a money-back guarantee that lets you cancel your program at any time without a penalty.
Read the full Accredited Debt Relief review.
Best for Customer Satisfaction : New Era Debt Solutions
New Era Debt Solutions maintains a staff of attorneys ensuring that everything is done according to state and federal law giving consumers confidence in the job done.
No upfront fees or monthly administration charges
Attorneys on staff
All services handled in-house
Free consultation with a debt specialist
Not available in certain states and cities
New Era Debt Solutions has been in business since 1999 and has helped clients settle over $250 million in debt. Clients do not pay any upfront charges for its services. Its plans also come without any monthly administration fees, and performance-based fees are only charged when you see results.
Like other debt settlement companies, New Era Debt Solutions has its clients save money for debt settlement in a separate account. In the meantime, they negotiate with your creditors to help you pay less than what you owe.
According to the company, its clients settle their debts and become debt-free after an average of fewer than two to three years. They claim to be able to expunge over 50% of debt owed. The company claims to lower both the balance and interest rates of debts.
Other benefits of New Era Debt Solutions include the fact it has attorneys on staff and an account management team is also assigned to each client from the start. The company also handles all of its work in-house and never outsources tasks to other unproven firms or contractors.
Read the full New Era Debt Solutions review.
Best Interactive Program : Freedom Debt Relief
We chose Freedom Debt Relief as the best interactive debt relief program for its interactive client dashboard that lets clients track their progress.
Free consultation and no upfront fees
Client dashboard lets you track your progress
Less transparent results reporting
Freedom Debt Relief has been in business since 2002 and currently employs over 2,000 highly trained debt experts and professionals. It starts clients off by offering a free consultation with a certified debt consultant who can help them talk over their debts and what they hope to accomplish. From there, they craft a personalized debt settlement plan that asks you to save a specific amount in a separate account to use for debt settlement later on.
One feature that helps Freedom Debt Relief stand out is its interactive process. Once you sign up for a debt settlement program and begin making deposits, you’ll qualify for a client dashboard that you can use to stay up to date on your program. This dashboard lets you see how much you have saved, how much you owe, and any progress Freedom Debt Relief has made negotiating debts on your behalf.
Freedom Debt Relief says its clients don’t pay any fees until work is done on their behalf. By the end of their debt settlement programs, customers pay a fee equal to a percentage of the amount of debt they enrolled in the program. While Freedom Debt Relief cannot guarantee it will settle your debts, it claims that many of its clients wind up paying significantly less than the amounts they once owed.
Read the full Freedom Debt Relief review.
Best for Tax Debt Relief : CuraDebt
- Debt Management Plans: Yes
- Debt Settlement: Yes
- Fee: Varies, average fee of 20% of debt enrolled
While other debt relief companies shy away from tax debts, CuraDebt offers special assistance for consumers who owe back taxes. This program is offered on top of its traditional debt settlement programs that can help consumers become debt-free while paying less than what they owe.
Debt settlement programs and assistance with back taxes
In-person consultations only available in Hollywood, Florida
CuraDebt has been in business since 2000, and it offers a free consultation for consumers interested in its debt relief programs. Like other debt relief companies, CuraDebt also displays an array of debt settlement letters on its website, many of which show consumers who settled debts for as little as 20% of what they owed. Additionally, the company reports that its customers typically pay approximately 20% of their enrolled debt amount in fees over time. There are no monthly administration fees.
Where many other debt relief companies don’t touch outstanding tax debts, CuraDebt offers specific assistance for consumers who owe back taxes and need help coming up with a plan while they manage other debts they have. This makes CuraDebt unusual in that it can help consumers who have multiple types of debt including taxes, credit cards, and personal loans.
Specifically, CuraDebt's assistance for tax debt relief includes flat-fee pricing and help to settle and to negotiate on IRS and state tax debts. It even has federal and state tax experts on staff, and this assistance is available in all 50 states.
Read the full CuraDebt review.
Best for High-Interest Credit Card Debt : DMB Financial
We chose DMB Financial as the best for high-interest credit card debt based on its dedication to helping consumers consolidate their debts into a new, lower payment, which can be especially helpful when it comes to growing debts with high interest rates.
Consolidate high-interest debts
Settle your debts for less than what you owe
No specific eligibility requirements for their programs
Lack of price transparency on their website
Founded in 2003, DMB Financial has a long history of helping clients establish debt settlement programs. This company reports results for its clients on its website. DMB Financial is also a member of the American Fair Credit Council, which includes a select number of debt settlement companies that commit to the highest standards for their clients.
You can call the company for a free initial consultation with a program consultant who can help you talk over your situation and goals. From there, a program will be created for you, during which you will make monthly deposits into a separate account. DMB Financial will then negotiate with your creditors for you to pay less than what you owe on your debts.
While DMB Financial focuses on all unsecured debts, it claims to be able to help consumers the most with high-interest credit card debt. With one of its programs, you can consolidate all your bills into a single monthly payment you make into a savings account each month. This can be a lifesaver when your interest rates and bills are just too high and continue to grow as you make only minimum monthly payments.
Read the full DMB Financial review.
All of the best debt relief companies on our list are reputable, offer various services, and have overall good reviews with helping customers manage and reduce their debt. Some provide numerous debt relief options and others charge lower fees. Overall, we recommend checking out National Debt Relief first. The company has a proven track record, a money back guarantee, and shows clear examples of debt reduction on its website.
|Company||Debt Management Plans||Debt Settlement||Fee|
|National Debt Relief
|Yes||Yes||15%-25% of debt enrolled|
|Accredited Debt Relief
Best for Debt Settlement
|Yes||Yes||15%-25% of debt enrolled|
|New Era Debt Solutions
Best for Customer Satisfaction
|Yes||Yes||14%-23% of debt enrolled|
|Freedom Debt Relief
Best Interactive Program
|No||Yes||18.25%-25% of debt enrolled|
Best for Tax Debt Relief
|Yes||Yes||Varies, average fee of 20% of debt enrolled|
Best for High-Interest Credit Card Debt
How Debt Settlement Works
Debt relief companies follow a process called debt settlement, in which companies ask their clients to set aside a specific amount of money in a dedicated savings account each month. The goal of this account is to build up a sum of money that can be used to settle debts later on.
Debt relief companies negotiate with creditors on your behalf, which typically involves offering less than what you owe toward your balances. During this time, you are encouraged to stop paying your bills and continue directing your funds to the savings account.
While paying less than what you owe may sound ideal, the Federal Trade Commission (FTC) notes that debt settlement has risks. The major one comes once you stop paying your bills while they negotiate with your creditors, which can have grave consequences for your credit score. Also be aware that creditors are not required to settle your debts for less than what you owe, so there’s no guarantee your debt relief company will be successful.
Pros and Cons of Debt Settlement
- You may get out of debt sooner: A debt settlement plan should get you out of debt sooner than other strategies because generally you are repaying less than you owe.
- You may avoid bankruptcy: A debt settlement may buy you time and financial space to get your finances in order and avoid more a drastic solution like bankruptcy.
- Your credit score is likely to be harmed: While the debt relief firm negotiates with your creditors, you will be asked to stop making payments, which may cause your credit score to drop.
- You may not be able to settle all of your debts: Creditors are under no obligation to work with you and your debt relief company. Some of your debts may be included in the plan, and some may not.
- You may not be able to stick with the plan: Depending on your budget, you may not be able to stick with the program through to its conclusion. You'll be out any fees you have paid, and you'll still owe on your debts.
- You may face tax implications: Forgiven debt may be considered taxable income.
Alternatives to Debt Relief Programs
Debt relief companies and debt settlement plans are not your only option for getting rid of debt. If you're considering debt relief, also consider some alternatives:
- Non-profit credit counseling: Credit counselors review debtor finances, come up with budget and spending plans, and help pay off debt. Fees for many of these services are modest, or even free.
- Debt management plan: Credit counselors work with your creditors to negotiate payment plans with potentially lower interest rates. You’ll pay a single payment to the credit counseling agency until your debt issues are resolved. These plans usually come with a fee.
- Debt consolidation loan: A debt consolidation loan is simply one loan (or credit card) you use to pay off one or more other loans. This can simplify the repayment process and may result in actual savings if the consolidation loan is at a lower interest rate that the other debts.
Frequently Asked Questions
What Does a Debt Relief Company Do?
Debt relief companies are for-profit organizations that help consumers settle their debts for less than what they owe. These companies gear their services to clients who are so overwhelmed with debt that they cannot figure out a solution on their own.
While there are plenty of reputable debt relief companies out there, it’s important to note that the debt relief industry is rife with scams. The Federal Trade Commission (FTC) says it’s wise to be judicious about companies you work with for this reason. You should also strive to avoid working with debt relief companies that try to collect fees before they settle your debts or ones that advertise a new government program that could help.
How to Choose a Debt Settlement Company?
Before you hire a debt relief company make sure you understand the fees, the services offered, and the firm's reputation. Debt settlement generally costs 15% to 25% of the amount of the debt owed. Look for companies that are accredited by the American Fair Credit Council or the International Association of Professional Debt Arbitrators. Any company you consider should be transparent about its pricing and its process. Avoid any firms that seek payment upfront.
How Long Does Debt Settlement Take?
Debt settlement can take three to four years to complete, starting from the time you stop making regular payments to your creditors and until you ultimately pay off the discounted amounts negotiated by a debt relief company.
What Is Debt Consolidation?
If you’re wondering about the difference between debt settlement and debt consolidation, here are some details to keep in mind. Where debt settlement involves working with a debt relief company to settle your debts for less than what you owe, debt consolidation requires you to take out a new financial product (typically a personal loan or a balance transfer credit card) to consolidate all your existing debts.
With debt consolidation, you’ll move all your old debts to the new loan with a lower APR or better terms. While the goal of debt consolidation is saving money, debt consolidation can also help you go from paying multiple debt payments each month down to just one.
Do Debt Relief Companies Hurt Your Credit?
One major downside of debt settlement programs is the fact that your credit score can take a hit once you stop making payments. This makes sense since your payment history is the most important factor used to determine your FICO credit score.
Damage to your credit score isn’t all you have to worry about. Stopping payments while you save money for debt settlement also can lead to late fees and penalties that can cause your balances to go up even more. You also may get calls from creditors or debt collectors during your program, and you even could be sued.
How Much Does Debt Relief Cost?
Debt relief companies tend to offer a free consultation to get the process started. From there, they charge performance-based fees that typically work out to a percentage of the debt amount you have enrolled.
Based on the companies we profiled, common debt relief charges work out to 15% to 25% of the total debts enrolled in a program. This means that, if you sign up for a debt settlement program with $10,000 in credit card debt, you may wind up paying $1,500 to $2,500 to get it resolved. And remember, that’s on top of the amount you pay your creditors to settle your debts.
We started the process by creating a debt relief methodology and looking for debt relief companies that have been in business for more than five years. From there, we gave precedence to firms that offer a free, no-obligation consultation with a debt consultant. While debt relief companies don’t advertise or charge flat-rate fees you can commit to ahead of time, we also gave extra points to companies that advertise a range of potential fees on their websites. Finally, we compared companies based on their proven success in helping clients settle debts for less than what they owe.
Federal Trade Commission. "Debt Relief and Credit Repair Scams."
National Foundation for Credit Counseling. "Debt Settlement."