Debt Relief Programs: Everything You Need to Know

Debt Relief Programs Everything You Need to Know

Debt doesn’t necessarily have to be a bad thing if used wisely. For example, almost every adult in the US has, at one time or another, owed a debt. So, don’t beat yourself up about yours.

However, debt can be an object of worry when it is too much to pay, either because of much accumulation or a financial crisis. And such a situation is the best time to opt in for debt relief.

Debt relief generally refers to any tool or service that helps you reduce and manage your debts. This could be with the help of a professional, or you can do it yourself. We will discuss different relief programs, their pros and cons, how they work, etc.

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Best Debt Relief Companies in 2023

Many relief companies are offering a lot of Americans their invaluable services. They do this through negotiation or by replacing your outstanding payments with a new loan with alternative conditions. This condition could include a lower APR, no fees, a more extended loan period, or a smaller amount.

However, many companies are offering such services. And this might be difficult to tell which one is good or has the best services. Therefore, we have compiled a list of companies with some of the best relief programs.

National Debt Relief

National Debt Relief

Best for Overall Best

In 2009, National Debt Relief was established with the primary goal of assisting people in debt relief. And the company prioritizes a credible settlement program. As a result, National Debt Relief is one of the country’s most respected settlement firms. It has a Better Business Bureau (BBB) rating of A+.

To get started, you will fill out the online form providing the following information: 

  • Your name.
  • Your email. 
  • Contact information 
  • The estimated amount that you owe 

Your total enrolled debt must be at least $10,000 before you can qualify for this program. And if found eligible, one of the company’s counselors will contact you to arrange a consultation for free.

Although no up-front costs are required, users often pay 15% to 25% of the total debt they registered in the program for when they are settled. Programs from this company typically last between 24 and 48 months.


  • An easy debt relief process
  • A personalized debt management plan
  • Free Consultation


  • Fees can be as high 

Accredited Debt Relief

Accredited Debt Relief

Best for Debt Settlement Plans

Accredited debt relief is one of the leading financial institution companies in the USA. Since 2011, Accredited Debt Relief has operated with the primary objective of giving families that require access to debt relief choices. The company is reputable for reducing up to 50% of the outstanding payments of its customers. And has an A+ BBB rating. In addition, accredited Debt Relief employs a procedure known as debt settlement to assist you in getting out of debt. 

With the debt settlement method, you’ll stop paying with your credit cards and start saving extra cash in a particular savings account. Then, when you have 40% to 50% of each obligation held in the savings account, the company will start working to negotiate a lower sum.

Although the duration of this procedure might vary, the firm reports that each program usually calls for a commitment of 12 to 48 months. Even though this organization charges 15% to 25% of each enrolled obligation in fees, you don’t pay any amount until a settlement is reached.


  • No upfront fees required
  • Free Consultation
  • Money-back guarantee


  • Fees can be high (up to 25%)
  • Pricing terms are not clear.

DMB Financial

DMB Financial

Best for High Reduction Amount

DMB Financial Debt Settlement was founded in 2003. With a BBB rating of B-, this company currently serves 49 states across the US with its various relief services. DMB Financial operates on a contingency fee basis. Hence, when a customer joins, the company will charge fees based on a percentage of the outstanding payments. Sometimes, the fees are charged based on a certain percentage of the savings negotiated by the company. Settlement fees often depend on the client’s debt, but DMB Financial’s fees range from 18% to 25% of the enrolled amount. With DMF Financial, clients typically receive a 45% to 60% reduction of their enrolled money owed. For this reason, we recommend contacting their customer support to get an accurate price.

While most other companies typically request at least $10,000, DMB only requires clients to have the least balance of $7,500. But the firm will only assist in settling individual accounts with a balance of $500 or more per account.


  • No consultancy fee
  • A low minimum amount is required


  • A minimum balance of $500 per account is required.

New Era Debt Solutions

New Era Debt Solutions

Best for Low Settlement fees

Since it first began operating in 1999, New Era Debt Solutions has provided various financial services to US citizens. It aims to assist consumers in managing and paying off their outstanding payments effectively. One thing that separates them from other firms is their personalized services. They work with clients to find the best program and have an A+ BBB rating.

Its service fees range from 14% to 23% of clients’ debts enrolled in any of its programs, which is lesser than the industry standard. With an average reduction of 53%, New Era clients typically pay back 30% less after fees than they would have paid without the company’s services. The duration of the company’s programs ranges from 12 to 48 months. It depends on the individual’s situation, but it lasts about 28 months on average.


  • No consultancy fees
  • Personalized service
  • A high reduction rate of up to 53%


  • It is only available in a few states.
  • Requires a minimum of $750 per account balance


Cura Debt CuraDebt - Best for Tax Debt Relief

Best for Tax Debt Relief

Curadebt was founded in 2000 and has offered various debt relief services since then. It has a BBB rating of A+. CuraDebt’s services are easily accessible, and the procedure is easy to follow. To see if you are eligible for the company’s services, you must first complete an online form. You will fill in your basic information, location, and the amount you owe. Afterward, you can arrange a free consultation with a credit counselor (provided you are eligible). The counselor will suggest the best program after they have more information about your situation. 

The internal team will then discuss your situation with each creditor individually. Each time a settlement is made, the company will notify you. CuraDebt charges an average of 20% of the total settlement. But the company will keep negotiating until you settle all your outstanding payments. CuraDebt has positive reviews left by satisfied clients if you search for other review sites like TrustPilot. In addition, the company has an overall respectable web reputation.


  • You can qualify with as low as $5000
  • Free Consultation
  • No monthly fees or upfront.


  • Not available in every state

Freedom Debt Relief

Freedom Debt Relief

Best for top accreditation

Freedom Debt Relief has been in the debt settlement sector since 2002. Today, the company has handled more than $10 billion in money owed with an A+ BBB rating. It is one of the founding members of the American Fair Credit Council. 

Provided the debt has no collateral backing, this company offers specialized settlement programs for different kinds of debts. So, this company might be able to provide you with a settlement option if you have unsecured debts like credit cards, hospital expenses, etc. The firm also offers debt settlement programs for some corporate debts and private student loans. 

You must have enrolled debt of at least $7,500 to be eligible for a relief program of this company. Freedom Debt Relief does not settle mortgages, federal student loans, and vehicle loans. 


  • No consultation fees
  • Client portal for tracking settlement progress


  • Services are not available in all states
  • Limited services available


What Is Debt Relief?

Debt Relief: what does it mean

Debt relief refers to reducing or refinancing debt to make it easier or less burdensome for the borrower to repay. Debt relief plans can help you manage your obligations and make them more affordable, but it is not appropriate for everyone. First, you must understand how the debt relief program works and how relief may impact your financial situation.

Debt relief offers various solutions (depending on which company offers it). This could involve a new loan with a different interest rate or payment plan, or you might even see a decrease in the overall amount you owe. Depending on the solution you choose, various changes may be necessary. After selecting a program that works for you, be careful to adhere to the conditions of the revised arrangement. 

When to Seek Debt Relief

Debt relief is not for everyone, so you should understand when it is needed. Although there is no general reason for seeking these programs, know that some instances warrant it. For example, if you are in the following situations, then you need to seek debt relief:

  • You have little chance of paying off your unsecured loans within the next five years, which include credit cards, hospital bills, and other loans without collateral.
  • Due to your financial obligations, you struggle to pay for your monthly expenses or live paycheck to paycheck.
  • If you don’t pay your obligations on time, you could lose your home or have your car repossessed.

Note that some relief options come at a price. Before registering for any program, understand the terms and consider the fees and the effect on your credit. It might be worthwhile to manage the debt on your own if you can do it at a lesser cost or without putting your credit on the line.

Is It Worth Doing a Debt Relief Program?

If you are unsure if debt relief is a good option, consider the following and see if it is enough.

Reduction in monthly payments or interest rates

Depending on your option, you may be able to cut down your interest or can help you get a more manageable monthly payment. This is available with a consolidation loan or DMP.

Debt Management and Reduction

The main benefit of debt relief in any form is the ability to reduce your debt. A credit counselor interacts with creditors to develop a repayment schedule for debt management programs (DMPs), frequently offering lower interest rates. In addition, settlement firms aim to reduce the amount you can pay by negotiating with creditors on your behalf. As a result, the company can ease high loads by lowering interest rates or the total amount owed.

Professional Financial Support

Debt relief programs entail consulting financial experts, which is an additional benefit. Consumers are frequently unaware of all their options or how to negotiate with creditors. Suppose you struggle to manage your finances and outstanding payments on your own. In that case, the US Federal Trade Commission advises that you weigh your options carefully before getting assistance from a credit counselor. A counselor can advise on the best step to take, including debt settlement, debt consolidation, bankruptcy, or a Debt Management Plan (DMP).

Risks of Debt Settlement

Even though relief has many benefits, you should consider the following drawbacks:

Results Not Guaranteed

There is no assurance that your debt will be decreased, which is the main disadvantage of debt relief. The FTC cautions that although lenders are not required to negotiate debts, several settlement schemes assert that they can lower payments by as much as 70%. Also, you risk paying more fees and increasing the amount you owe if you stop paying your credit card bills because you think your creditor will approve a settlement.

Credit Damage

Bankruptcy and debt settlement can both negatively impact your credit ratings. Even if you ultimately pay off the obligations or have it dismissed, a record of the occurrence will stay on your credit reports for 7 to 10 years. And this is because, in the real sense, you did not pay the creditor. And this may make it challenging to be accepted for loans with reasonable interest rates in the nearest future.

High Costs

There will be a cost associated with relief unless you are working with nonprofits. Some of the attached costs include business fees for services or financing products, legal fees for bankruptcies, and even fees charged occasionally by nonprofit counseling organizations to facilitate your monthly payments.

Best Ways of Debt Relief

You have a wide range of options when looking for relief. There are many options to consider, including negotiating with your lenders, requesting special programs, and taking legal action. The best place to start is to thoroughly assess your options before deciding. This is why we have compiled many relief options discussing how they work, their benefits, and their drawbacks.

Debt Relief through Bankruptcy

People unable to pay their bills can file for bankruptcy through legal procedures. This legal action halts creditors’ and collection agencies’ phone calls, letters, and other attempts to get you to pay your obligations. As a result, people with excessive outstanding payments frequently consider declaring bankruptcy as a viable solution to their credit problems.

Even though declaring bankruptcy may seem like an excellent option to wriggle free of your payment, we recommend that you should only do so as a last resort. This is because your credit report will show your bankruptcy history for ten years. It could be difficult for you to get a personal loan or credit to purchase a car or home during this time. 


  • By wiping off all the amount you owe, bankruptcy gives you a fresh start.
  • The harassing phone calls, letters, credit card cancellations, refused charge authorizations, and legal actions from creditors will end.


  • You will have to wait for years (usually up to 8 years) to be able to file for another bankruptcy.
  • Cannot remove student loan 


 Bankruptcy is best for borrowers with no other way to get the owed money, as they may benefit from a fresh start. 

Relief through Debt Management Plans

During counseling, credit counselors frequently suggest DMPs, which are all-inclusive private services, to aid consumers in managing their credit. This is how it works:

Credit counselors and credit card issuers have long-standing partnerships to assist clients. You can pay off your unsecured loans (often credit card debts) at a lower interest rate or without fees. Each month, you give a single payment to a credit counseling organization, and they divide it up among your creditors. This is how they negotiate on behalf of the client.

However, you’ll not be able to use credit cards until you complete the plan.

Note that DMPs themselves do not have any effect on your credit score. But closing your accounts can hurt your scores. However, you can reapply for credit after you’ve finished the plan.


  • You need to make only one monthly payment.
  • It helps you complete the payments faster
  • You can pay with a lower interest rate


  • The requirement to close your credit card account will hurt your credit score.
  • To maintain the benefits, you must make regular payments.


A qualified credit counselor’s assessment and advice are the only way to know whether a DMP is appropriate for you. And once they have confirmed you are eligible for one, they will devise a plan that fits your situation.

Relief through Debt Settlements

Most debt settlement firms will request that you stop making payments to your creditors and instead deposit your money in a bank account under their management. The company will then contact your creditors and try to negotiate. The idea is that the creditor may agree to accept a smaller amount out of fear of receiving nothing at all. However, since the process takes years, the money builds up in your account, and you fall farther and further behind on payments. 

However, this plan will not stop collection calls, legal actions, and fines that arise from unpaid bills against you. And the continued delay of the payments will further hurt your credit score. A better option is a nonprofit debt settlement because it does not involve negotiations. Instead, if the money is paid back over three years, some lenders would be willing to accept 50% to 60% of the whole amount.


  • You might pay an amount lower than what you owed
  • Could help you avoid bankruptcy


  • Creditors might not agree to negotiation terms
  • It hurts your credit score
  • Settlement fees could be high


While this seems like a good option, we do not recommend it any more than we will recommend bankruptcy. This is because there are many problems usually associated with this method.

Programs and Services of Debt Relief You Should Leave to a Professional

While there are debt relief programs you can do yourself, there are some that we recommend you leave to professionals to handle. This is because professionals can help you solicit for better terms or offer you better solutions that you could have come up with. Below are examples of these services.

Credit Counseling 

The credit counseling agency will often offer financial advice as part of their service, which involves a credit counselor thoroughly examining your income, expenses, and obligations. This financial assessment may also entail separating your expenses into essential and non-essential expenditures. 

The counselor will develop a repayment plan after reviewing your finances and considering your household and business needs. 

Obviously, this method cannot be a do-it-yourself scheme because it requires a professional to assess and devise a plan based on your financial situation.


With bankruptcy, you could either cancel your debts or get a payment plan that helps you wipe your debts. For example, if you file for Chapter 7 bankruptcy, you could get your debts discharged. And if you file for Chapter 13 bankruptcy, you could be placed on a repayment plan to pay off your debt for three to five years.

However, since the solution is strictly a legal matter, it wouldn’t be advisable to attempt to go through it yourself. Debt relief firms have experienced professionals, and it would be much easier if they helped you through it. 

Services of Debt Relief You Can Handle

Sometimes it might be an excellent option to handle your financial obligations yourself. It will save you from some of the associated risks of using relief companies, such as scams, high settlement fees, etc. Here are some of the services you can handle yourself:

Debt Management Plans

Nothing prevents you from doing what credit counselors do when creating DMPs. For example, you could contact your creditors and tell them why you were behind on payments and what arrangements you require to make the difference. 

Mortgage Refinancing

A mortgage is arguably the biggest debt owed by most Americans. And if you find yourself in this situation, refinancing your mortgage may be your best chance to get relief. Although it can be challenging to qualify for refinancing, doing so can get you a better interest rate, cheaper monthly payments, or a quicker payoff of your financial obligations. With this, you don’t need any agency or professional to help you negotiate or advise you. All you require is to find a reliable mortgage lender, check your eligibility and apply.

Credit Card Negotiations

Some credit card providers could be accommodating regarding your payment conditions. This way, all you need is to reach out to them, explain your financial difficulties, and check what they can offer you. They might consider reducing your minimum payment or negotiating your interest rate. You will have a better chance at this if you have a history of making on-time payments on the account.

Be Aware: Scammers

Scammers frequently target consumers looking for debt relief. They can pose as lenders, relief company agents, or government agents. Anyone who contacts you with an offer of relief, such as student loan forgiveness or mortgage assistance, is likely trying to scam you.

Always get in touch with your lender directly to verify the offer’s legitimacy. In addition, we recommend that you do a background check on the company, read online reviews, and confirm the office location and other safety measures before proceeding with the program. 

Here are some of the things to look out for to recognize a scam:

  • Refusal or pressure to sign documents
  • Requesting untraceable payment methods such as cryptocurrencies.
  • Requesting payments upfront


How do I qualify for debt relief?

Your eligibility for debt relief depends on the type of relief program you opt for. The requirement for consolidation will differ from that of DMP. Another determining factor is the company or agency offering the relief services.

What is the downside to debt relief?

Generally, debt relief can be a disadvantage than relief if not managed well because it can lead to more deficit accounts. However, each relief options have its respective downsides too.

Are credit card debt relief programs real?

Yes, credit card relief programs are real. For example, you can renegotiate your credit card bills and adjust the payment plan or get a reduced interest rate. Some plans, however, make credit cards unavailable for use during the period.

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