In the United States, credit counseling agencies are loosely regulated by the Federal Trade Commission (FTC), the nation's consumer protection agency, which can sue companies that have deceived consumers about the cost, nature, or benefits of their services.[1] Different states may regulate DMPs individually and attorneys general are empowered to protect state citizens from fraud.[5]
Negotiating a debt relief plan. Trying to work with creditors should come first before bankruptcy. Let the lenders know you aren't able to pay your bills and are thinking about filing for bankruptcy protection unless they're willing to work with you. The creditors may allow you to repay a portion of your debt -- either in a lump sum or over time -- and forgive the rest. 
In addition I had inform them that I was closing the checking account that they had been taking the payments from so they were not to charge that account going forward. That I wouod get back to them with the new information for my new checking account. I purposely had not given them the information because I was researching what my recourse was so when it came time for the payment I hadn’t given the information and on their website it’s it’s showing that I owe them money for fees and they wanted their money so what did they do they charged my old account which had nothing in it so I was hit with a NSF fees and every 3 days I get charged a fee for the negative balance but they got their payment and I’ve got payment it went to fees for the accounts that they lost the settlement because couldn’t make payments to my creditors Beach they had drained my account for all the fees

Yes and no. If you begin with the biggest debt, you won’t see traction for a long time. You might think you’re not making fast enough progress and then lose steam and quit before you even get close to finishing. It’s important to pay your debts in a way that keeps you motivated until you’ve wiped them out. Getting quick wins in the beginning will light a fire under you to pay off your remaining debts! Listen—knock out that smallest debt first, and you will find the motivation to go the distance. 
Step 1: Open a dedicated savings account. At the start of your debt settlement program, National Debt Relief requires that you open a savings account where you will begin making monthly payments. The amount you pay each month is decided on by National Debt Relief, and is generally lower than the total payments you’re currently making to creditors. You are in total control of the funds in your account, which is only disbursed once a settlement is reached between National Debt Relief (on your behalf) and your creditors.
Find information on credit counseling agencies in Texas near you. Numerous non-profit organizations operate in the state and can provide mortgage, debt, and various other forms of assistance to consumers and homeowners. The agencies deal with issues ranging from credit repair to debt management plans, bankruptcy filing, and other financial matters in Texas, and most services are free of charge. More information is below, including how to get help by county.

Home equity. Another way to refinance your debt is to tap into your home equity to repay what you owe. If you have equity in your home -- that is, you owe less than your mortgage balance -- you can get money out of your home using a home equity loan or a home equity line of credit. You could also refinance your entire mortgage and do a cash-out refi wherein you get a new loan to repay your old mortgage and give you extra cash in the process.
The content on this page provides general consumer information. It is not legal advice or regulatory guidance. The CFPB updates this information periodically. This information may include links or references to third-party resources or content. We do not endorse the third-party or guarantee the accuracy of this third-party information. There may be other resources that also serve your needs.

Do yourself a favor, if you were ripped off like me by National Debt Relief, submit a complaint to ConsumerFinance.Gov. My lawyer counseled me on this. When I called from my job, they did not disclose they were a for profit agency, I had to ask them. They did not tell me the percentage that they would take as profit. I did not learn that until about 3 weeks ago when I demanded to know the profit they took. Their answer after a long time of questioning was they took 25% off the original debt for themselves. When I said that I did not know this. Their response was : “it is in page 3 of the contract.” I could not find this information anywhere nor it was said to me. The representative who enrolled me Berlinda C only said ” We take a small fee” but would not specify the amount. So far, they have taken from me $2,500 and my creditors have hardly seen any money. When a settlement is negotiated, they take everything they have taken from my account for themselves and on top of that charge about $60 monthly extra in order to make the payments to the creditors. I find this sum exorbitant. I now closed my account with them because I have realized the rip off that this company is. I have lost $2,500 for their profit.
Hi everyone, in the UK we have student loans, but these are paid back through your salary when you start earning over £15,000 Gross Salary. Depending on when the loan was taken out, interest rates vary from 1-3% (so quite low). Basically if you’re not working, they cant take the money from you. Is this how it works in the US? Great site by the way it really puts things into perspective.

Late fees and other penalties. If you are not actively paying down your debt, the lender will assess late fees and raise the interest rate so that your debt actually grows. Again, this applies specifically to debt settlement, but could happen with late payments in either a debt management program or debt consolidation loan. Be aware that not making at least minimum payments on your debt each month is going to cost you.

Credit score is not a factor with credit counseling. The initial consultation, even with a credit check, won’t affect your score. There is no minimum score requirement to enroll in a debt management program. In addition, when done correctly the program has either a neutral or positive effect on your credit. In other words, if you still have good or excellent credit, this program won’t set you back.
In some cases, credit card companies allow you to use balance-transfer checks. Essentially, you'll be able to deposit money in your bank account and get the special promotional balance transfer rate of 0% interest for a designated time. If you take advantage of this offer, you'd still pay whatever fee the card imposes for balance transfers, if any. This approach allows you to use a balance transfer to refinance even non-credit card debt to the 0% promotional rate. Just be careful not to confuse balance-transfer checks with a cash advance, which involves having your credit card lend you cash at a very high interest rate. 
It is rare to get a quick-fix solution to debt problems. If that is one of the promises you hear, start looking elsewhere. Remedy: The first thing to understand is that debt-relief programs typically take 3-5 years, so be patient. Second, check up on the whatever company you choose for debt relief. The Better Business Bureau or local state attorney’s office are good places to start. Credit unions, universities and military bases should be reliable sources for recommendations. Be sure whatever organization you choose is licensed and doesn’t have a record of consumer complaints.
Start online credit counseling to see if you qualify for our debt consolidation alternative. During your free counseling session, we’ll help you identify the root cause of your financial problems. We’ll also help you develop a budget that minimizes your monthly expenses. Finally, based on your income, assets and budgets, we’ll recommend a debt relief solution tailored to your personal situation. This solution may be the debt management plan which consolidates your monthly payments. Other solutions include bankruptcy and referrals to other nonprofit organizations who can help you save money and eliminate debt. If you’d prefer to speak with a live counselor, call the number on the right.
Help from debt collectors is available. Find how to get help from debt collectors and learn how to stop collection calls. Families being impacted by this can also receive other assistance, whether free legal aid or counseling. Many government laws and regulations can also help protect you from aggressive collection tactics. They are intended to asisst the everyday consumer. Find how to get help from debt collectors.

Most nonprofit agencies are members of either the National Foundation for Credit Counseling or the Financial Counseling Association of America. Both of these groups have certification requirements to ensure a standard level of education and quality among counselors. They also require accreditation, in which an outside body checks that standards of practice are being met.


For most people I would say that signing up for National Debt Relief is not a good idea. While on its face, having you pay no up front fees with the goal of making you debt free in 2 to 4 years sounds great.  However the truth is there may be better options which can accomplish the same goals for a lower cost and that have less of an impact on your credit and your sanity from being sued by a debt collector.  Debt settlement in my opinion is best suited for people who have already been delinquent with their debts and have lump sums to offer up front to negotiate settlements of 50% or less in many cases.  Otherwise chapter 7 bankruptcy or chapter 13 bankruptcy may be the best fit to eliminate debt or pay off debt over a 3 to 5 year repayment plan and avoid being sued by a lawsuit.

Hi Angry – This is a great question and one that we may be covering in a future story with a more in-depth look at how sports teams manage season ticket holder accounts. Out of curiosity, which team were the season tickets for? We may be able to reach out to them for comment about how they handle collection proceedings with defaulted ticket holders.
Through a nonprofit credit-counseling agency, you can work with a counselor to resolve your financial problems on your own, says Bruce McClary, vice president of public relations and external affairs at the National Foundation for Credit Counseling. Or you can enter what’s called a debt management plan. Through that plan, you can consolidate your credit card payments and get the cards’ interest rates reduced, making your financial obligations easier to tackle.
What Makes Me a Good Candidate for Debt Negotiation? A debt negotiation program is certainly not for everyone. Qualified candidates are those who have a legitimate financial hardship, which has caused them to fall behind on their payments to creditors, or will cause them to fall behind in the near future. National Debt Relief will not welcome anyone into the program that has the intentions of defrauding, deceiving, or swindling their creditors. We only represent consumers who are truly in need of our services and stand to significantly improve their financial situation.
It depends on how much debt you have and how successful National Debt Relief is in negotiating with your creditors. However, there are quite a few examples of how much past customers have saved in reviews on the Better Business Bureau (BBB) website. One customer claimed enrolling in the program helped them cut down their payments by almost 70%, while another said they were able to shave two years and $3,000 off their debt repayments.
Imagine, for example, that you have $20,000 in credit card debt and $10,000 in other non-mortgage debt. You might set yourself a goal of paying it all off in two years. (Set a specific time frame, too, lest you keep extending your deadline.) You can set sub-goals, too, such as having a quarter of it and half of it paid off by certain dates. Write down the goals and post them where you'll see them.
Rachel Kampersal said debt management plans require you to change your habits dramatically since you will have to stop using credit. “Per requirements from creditors, any card that is entered into a debt management plan will be closed, meaning you can no longer make charges to these cards. While difficult, it’s important to stop incurring new debt.”
There are some downsides though that you have to weigh, our credit scores did drop down to 630-680’s and some creditors list our payments as “late” for some reason. But CareOne said that the late status should change after about 3 months of consistent payments. Some creditors also list that your payments are being made by debt management program which I can assume does not look very good on your credit report.
Debt settlement sounds like a sexy option to consolidate debt. Who wouldn’t want to pay half of what you owe on credit card debt? But this is considered a desperation measure for a reason. The ads boasting that settlement companies like National Debt Relief can get 50% of your debt forgiven, don’t tell the whole story. That figure doesn’t include the fees you will pay, the penalties you incur while settlement negotiations take place and whether a creditor will even accept the offers made. Do all the math before you choose this option.
On average, National Debt Relief can reduce enrolled debt by around 49 percent which is slightly higher than Freedom and New Era. You will pay fees of between 15 to 25 percent on the amount that is settled. This debt relief company doesn’t charge any upfront fees, so you’ll only pay on the debts that are settled. Keep in mind, though, that the fees are in addition to the settlement, so a 20 percent fee in addition to a 49 percent settlement ends up being 69 percent of the original amount.
DMPs for consumers are often negotiated by a credit counseling agency on behalf of the debtor.[1] Credit counseling agencies often address the debt by working with the debtor to set a budget based on their regular income and expenditures that will then include one regular bill payment that is allocated across the creditor(s). Agencies will negotiate on behalf of the debtor to lower payments and interest rates with creditors. Some of the agencies are non-profits that charge no or non-fee rates, while others can be for-profit and include high fees.[1] The effect on the debtor's overall credit score will vary.[3] In the United Kingdom, as well as DMPs, residents can also apply for an Individual voluntary arrangement (IVAs), which can give the debtor a discount on their debt.[4]
Negotiating a debt relief plan. Trying to work with creditors should come first before bankruptcy. Let the lenders know you aren't able to pay your bills and are thinking about filing for bankruptcy protection unless they're willing to work with you. The creditors may allow you to repay a portion of your debt -- either in a lump sum or over time -- and forgive the rest. 
Take steps to rebuild your credit and improve your credit score, which in turn, could give you access to more credit in the future. For starters, focus on implementing a plan for paying off debt, and work to keep your balances low on credit cards. Keep in mind that improving your credit score requires small, responsible actions over time, so be patient and set long-term objectives. For more tips on how to improve your FICO score, take a look here.

Most nonprofit agencies are members of either the National Foundation for Credit Counseling or the Financial Counseling Association of America. Both of these groups have certification requirements to ensure a standard level of education and quality among counselors. They also require accreditation, in which an outside body checks that standards of practice are being met.
The company is clear about average fees ($40 for setup and $25 monthly, not to exceed $75 and $50, respectively) as well as average interest-rate and payment reductions on its website. They also publish detailed “transparency reports” that include debt management dropout rates, savings rates, and client satisfaction rates tracked over several years.
At this point, you will need to continue following the advice of the credit counseling agency you hired to help and remember the benefits of being debt-free. Life is a lot more difficult when you’re juggling credit card bills and other payments each month. If you want to avoid winding up back in debt, it’s crucial to remember how far you’ve come and how wonderful freedom feels.
Consumers can apply for a debt management plan regardless of their credit score. Once they set up an initial consultation with a credit counseling agency, they will go over the details of their debts and their income with their agency who will come up with an action plan on their behalf. If the consumer decides to move forward with a debt management plan, it can take a few hours or a few weeks to get started. “Once the recommendation for a debt management plan is made, it’s up to you to decide how quickly to enroll,” said McClary.
Compare debt settlement vs. debt consolidation programs as they have differences between the two. One or the other may be a better option for you and your family, and it depends on your personal financial situation. Get information about the pros and cons of these two approaches. Read tips on which option may be the best option for you and your situation. Compare debt settlement and consolidation.
In the United States, Credit counseling agencies are loosely regulated by the Federal Trade Commission (FTC), the nation’s consumer protection agency, which can sue companies that have deceived consumers about the cost, nature, or benefits of their services.[1] Different states may regulate DMPs individually and Attorneys General are empowered to protect state citizens from fraud.[4] Two professional associations represent Credit counselors: the National Foundation for Credit Counseling and the Association of Independent Consumer Credit Counseling Agencies.[6]
National Debt Relief is proud to be reviewed and ranked as a Top Provider by these independent review websites. National Debt Relief does not compensate these providers to apply their objective criteria to our company and rank us compared to our peers. We do, however, advertise on their websites because we are proud of our independent rankings. We have confirmed that each independent review is subject to its own criteria and not influenced by our advertising.

The internet has made it easier than ever to start a business with close to zero up-front costs. Set up shop as a freelance writer, proofreader, or virtual assistant, and offer your services to other companies who want outside help with hiring a permanent employee. You can work as many or as few hours as you want, with some people turning their businesses into six-figure full-time jobs.
Customer reviewers are mainly impressed with National Debt Relief’s quality customer service, which most report is helpful and patient, considering the situation. At least one customer was even able to start repairing their credit score. Negative reviews tend to have less to do with the drawbacks of National Debt Relief than debt settlement itself.
Freedom Debt Relief Disclosure: Clients who make all their monthly program deposits pay approximately 50 percent of their enrolled balance before fees, or 65 percent to 85 percent including fees, over 24 to 48 months (some programs lengths can go higher). Not all clients are able to complete our program for various reasons, including their ability to save sufficient funds. Our estimates are based on prior results, which will vary depending on your specific circumstances. We do not guarantee that your debts will be resolved for a specific amount or percentage or within a specific period of time. We do not assume your debts, make monthly payments to creditors or provide tax, bankruptcy, accounting or legal advice or credit repair services. Our service is not available in all states and our fees may vary from state to state. Please contact a tax professional to discuss potential tax consequences of less than full balance debt resolution. Read and understand all program materials prior to enrollment. The use of debt settlement services will likely adversely affect your creditworthiness, may result in you being subject to collections or being sued by creditors or collectors and may increase the outstanding balances of your enrolled accounts due to the accrual of fees and interest. However, negotiated settlements we obtain on your behalf resolve the entire account, including all accrued fees and interest. C.P.D. Reg. No. T.S. 12-03825. 
Hm, feel free to email me if you like, but here are a few questions/suggestions. What have you been living on while waiting? And how much are you allowed to earn above disability? While it can definitely be very tough to work while disabled, sometimes it is possible, and there are flexible ways to earn. (For example, blogging, although that’s not a quick way to do so.) I suggest brainstorming ways to bring in more and also ways to cut expenses, such as maybe getting a roommate or two to reduce your basic costs for housing & day-to-day living.

Yep, you read that right. And yes, we even mean stop contributing to your 401(k). Right now, you want all your income to go toward getting out of debt. Once you’re debt-free and have saved three to six months of expenses in an emergency fund, then you can resume your contributions. By then you’ll be on Baby Step 4 and can start putting 15% of your income toward retirement.


As far as options go, I’d recommend you start by talking with a reputable credit counseling agency – one of the options I mentioned in the story. That will give you a baseline to start with. If they can help you with DMP, it’s likely to do the least damage to your credit (with the exception of just paying the debt off) over the long run. If you/they determine a DMP isn’t feasible then you’ll know you have to look at more drastic options like negotiation or bankruptcy.
At American Consumer Credit Counseling (ACCC), we offer free credit counseling and low-cost services to consumers who are ready to say "I need help with my debt." Our highly trained and certified credit counselors can clear up any confusion around your finances, help you evaluate your financial situation, and go over all of the options for paying down your debt — from debt relief loans to debt settlement programs and debt management plans. We'll help you choose the avenue that will work best for your situation and goals, and provide you with ample educational materials to help you manage your money more effectively.
How it works: Settlement companies ask you to stop paying the credit card companies and instead, send regular payments to an escrow account. When the balance in that account has reached a sufficient level, the settlement company negotiates with the card company for a reduced, lump-sum payment. If the creditor agrees, money is sent from the escrow account. If there is not enough money in the account, a payment schedule is agreed upon.

National Debt Relief recently refunded part of the money that was saved in my account before I terminated my agreement with the company. I found this action on their part to be quite surprising and very much appreciated. This leads me to believe that they do have the best interest of their customers at heart. I have chosen to work with another company in becoming debt free and am very thankful for the services provided to me from National Debt Relief.
Not into starting your own business? Then consider becoming a driver for Lyft or Uber. A pizza delivery job at night could also bring in extra money. You can even deliver other types of food in your spare time by working for places like uberEATS or Grubhub. Sure, you’ll have to put aside your pride and give up some nights and weekends of downtime. But that’s a small sacrifice for extra cash in your pocket.
I’m about 70k in debt (which includes a car loan and student loans). I was very naive in thinking that earning a Bachelor’s degree would award me with a high paying job and I would be able to take care of this mountain of debt no problem. Of course, that’s not reality, and I make 25k a year. I’ve been working at this job for about a year and a half now, and I have FINALLY found a better paying job after a year of active searching. Although it’s not much, I’ll be moving up to 29k a year. While I pay off my 10k car loan at 250 a month, I’ve been completely avoiding my student loan debt, I don’t even look at it. Right now my loans are in deferment but I owe my first payment in August. I’m really starting to panick. I appreciated your article and found a lot of useful advice in it. I think my first step to paying off my loans will be to work as hard as possible at my new job so maybe after another year or so I can increase my salary more substantially…. Other than that I’m really at a loss for what to do. Any specific advice regarding such a high amount of student loans? (That honestly, I’m almost too embarassed to admit to in this post)
When it comes to paying off credit card debt, many consumers take the path of least resistance: the so-called "minimum payment plan." By law, credit card issuers are required to set a minimum monthly payment amount for each cardholder. These payments are calculated on the basis of the cardholder's total balance, interest rate and certain other factors.
I have been debating about Freedom Debt Relief, they seem like very good people but my question comes from that I am worried about my Credit Score. Here goes I have about 7-8,000 in credit card debt eventhough its not that much I have been laid off and have been looking for work for the past year trying to have been using my savings to pay off my credit. I am finding myself not struggling to do this longer but am in a delima that I have to get a place in the future and will not qualify to Rent. How long does it stay on your credit do agencies like Lexington Law Firm are good option in rebuilding it faster?
I recently became fed up with the credit card debt that I have been carrying for 6 years and have *finally* taken action to eliminate it, such as making a budget (and sticking to it!), trying to negotiate a lower APR rate, selling stuff (au revoir, gitane bicycle) and making additional payments on my credit cards. This article was EXACTLY what I needed to read. It’s affirmation that I’m on the right track (:
This is where it helps to talk to a professional. Consumer credit counselors understand all the options available to pay off credit card debt. They can impartially evaluate your debt, credit and budget to help you identify the best solution for your needs. You get an unbiased, expert opinion on your best course of action so you can move forward with confidence.

This company works with unsecured debt – typically credit cards – as well as medical debt, private student loans and personal loans. Its debt settlement plans require you to stop paying your creditors and instead make payments into an escrow account set up by National Debt Relief. You control the money in this account. After several months of making installments into this account the settlement firm will begin negotiating with your creditors.
Things to mention to get them on your side? Let them know how long you’ve been a loyal customer and that you would love to stick around. But, also share that other credit card companies are offering you lower rates, even 0% introductory rates for balance transfers, and that you can’t ignore the interest savings. Usually, they swing into customer retention mode, and they may be able to pull some strings.

Credit counseling. Most businesses in the debt-relief industry offer free credit counseling services. Certified credit counselors help consumers build an affordable budget and learn how to live with it. Counselors teach them the debt-relief options available and offer advice on which one best suits their situation. This is an overlooked aspect of many debt-relief services. It increases the financial literacy of consumers by leaps and bounds.
It’s true that many people get into debt because they lose their jobs. But some people get into debt despite having well paying jobs. It’s good to share information so that people have a plan to save while they have a job so they can weather a job loss. And for those who accumulate debt beyond their means while employed, it’s good to give them a plan of action to “right the ship.” Hope you find something that helps you weather your storms.
Both Freedom Debt Relief and National Debt Relief are well-established companies that have been debt settlement providers for several years. Freedom Debt Relief was founded in 2002, and National Debt Relief was founded in 2009. This is important because there’s potential for scams in the debt settlement business. Some companies claim to be debt settlement companies but are really just fronts for collecting debtors’ money and putting it in the company operative’s pockets. The longer a company has been in business, the more likely it is that it is legitimate.
Student loans:The federal government and private lenders issue loans to cover education costs. Federal student loans generally have a low interest rate and important borrower protections. Working in a qualifying public-service job entitles you to loan forgiveness after 120 on-time payments. Income-based payment plans also cap payments and allow a portion of your loan to be forgiven. While private student loans don't come with all these protections, rates may still be relatively low. And if your income is below $80,000 as a single or $165,000 if married filing jointly, you can deduct up to $2,500 in student loan interest from your taxes. Because of these perks, you may not want to pay off student debt early.
ADVERTISER DISCLOSURE CreditCards.com is an independent, advertising-supported comparison service. The offers that appear on this site are from companies from which CreditCards.com receives compensation. This compensation may impact how and where products appear on this site, including, for example, the order in which they appear within listing categories. Other factors, such as our proprietary website's rules and the likelihood of applicants' credit approval also impact how and where products appear on the site. CreditCards.com does not include the entire universe of available financial or credit offers.
×