Best Debt Resolution Programs of

What is Debt Resolution & How it Works

If you’re struggling with credit card bills, private student loans, personal loans or other forms of eligible debt, a debt resolution program can help you get back in the black.

The term “debt resolution” refers to strategies that help consumers regain control of their finances and get their debt under control. Common methods include:

• Credit Counseling: Typically nonprofit agencies that help with education, budgeting and organizing your debt. If you qualify, your counselor may also help you set up a structured payment plan.
• Structured Repayment Plans: This involves consolidating your eligible debt and negotiating with creditors to reduce your interest dates and fees. Once the plan is set up, you make monthly payments to the counseling agency, which in turn pays your creditors.
• Eligible Debt Settlement: This involves negotiating with your creditors to accept less than what you owe in order to pay off your debts. Once a debt is negotiated and settled, the sum is paid in full, rather than monthly installments.
• Bankruptcy: The most extreme type of debt resolution, as it damages your credit the most and stays with your credit history for the longest period of time—up to 10 years. Bankruptcy is usually seen as a last resort.

In this article, we will be focusing on for-profit debt resolution programs, as they can be among the most challenging to navigate and understand as a consumer. Debt resolution programs typically provide debt consolidation and eligible debt settlement services, although not every company provides both. Here’s how it works:

You’ll start with a free consultation to review your finances and go over the options that are available to you. Next, the debt resolution program will review your financial details and come up with a plan best suited to your needs and budget. If you decide to move forward, you will work with the company throughout the process, which typically takes two to four years.

Here are some important things to know:

• Debt consolidation requires a higher credit score for eligibility, so depending on your situation, this may or may not be an option for you.
• Eligible debt settlement can help you avoid bankruptcy, potentially save you money and save time compared to bankruptcy. But the fees can be steep, you will be required to come up with money for a settlement fund, and this method can have a negative impact on your credit during the process.
• The main advantage of working with a debt resolution program is that they take the burden of credit negotiations off of the consumer. This can be valuable if you are overwhelmed by your debt and don’t have the desire or ability to do it on your own. 

There are a few caveats to consider before working with a debt resolution program for eligible debt settlement: Success isn’t guaranteed, and most debt resolution programs only work with people who have at least $10,000 in debt. If the debt resolution program is successful in settling your debts, their fee can be 15 to 25 percent of your enrolled debt.

Depending on how much you owe, and how much is forgiven, though, this can still leave you well ahead of the game. If you’re overwhelmed and don’t know where to start on your own, it can be helpful to have a team of professionals to create a custom plan and help guide you through the process.

To figure out if you’re a good candidate for debt resolution, you’ll need to consider a few key factors:

• Type of Debt: Debt resolution programs only work with eligible debts like credit cards or medical bills, not auto loans or mortgages. And if you owe the IRS, you’ll need a tax resolution company instead.
• Total Owed: Most companies require you to have at least $10,000 in debt. A small number of firms may have a lower requirement, although it is not very common.
• Current Situation: If you’re overwhelmed with debt, behind on payments and can’t secure a loan or credit card with a more favorable rate, working with a debt resolution program for eligible debt settlement may be a good next step.

How We Determined the Best Debt Resolution Programs

We use a precise ranking system to rate the companies featured on this page. Each company is evaluated based on a set of criteria and ranked accordingly.

We like passing this information on to consumers for a couple of reasons—first and foremost for transparency, so you know how each company gained their spot on our list of the best; but also so you know what’s important to consider when selecting the best company for your needs. 

So without further ado, here is the criteria we used to evaluate the best debt resolution programs:

Services Offered

First, we look at the various ways that a debt resolution program can help their clients reduce, simplify or restructure their debt. Most debt resolution programs work with eligible debt settlement, or negotiate with creditors on your behalf to settle your debts for less than what you owe, and then use money you’ve saved up in an eligible debt settlement fund to pay off the settled amounts.

Some debt resolution programs may also offer debt consolidation options, although not all companies offer this service. This involves taking a loan out in order to pay off existing debts, and consolidating them into one single monthly payment, typically at a lower interest rate. Not everyone will qualify for a consolidation loan, but for those who do it’s usually the preferred option since it doesn’t have as big of an impact on your credit score.

Availability

Not every debt resolution programs’ services are available in every state. We check the availability for each company and clearly outline that in our reviews, prioritizing the options that are more available overall.

Fees & Requirements

By law, debt resolution programs cannot charge upfront fees. They can only charge you once they get one or more creditors to agree to a settlement on your behalf. Your fee is a percentage of the amount of debt you enroll with the debt resolution program—typically between 15 and 25 percent. In other words, if you enroll $10,000 of eligible debt, you will pay somewhere between $1,500 and $2,500 for the debt resolution program to negotiate settlements on your behalf. 

Other fees may include bank account fees, as the debt resolution program may require you to set up a separate savings or escrow account to bank money into for your settlement fund.

Debt resolution programs also have a minimum debt requirement in order to work with them. Most companies require at least $10,000 in existing debt.

Experience & Reputation

You want a debt resolution program that knows what it’s doing and has a strong reputation for doing it. We consider the number of years that a debt resolution program has been in business, as well as their reputation in the industry and overall rating with the Better Business Bureau. This helps paint a picture of a company’s experience and reputation, as well as how they operate and handle customer issues.

We also look at each company’s accreditations. The ACDR is a trade group that monitors and audits debt resolution programs as well as conducts research on the debt resolution industry. In addition, the International Association of Professional Debt Arbitrators offers education to the debt resolution program employees that work with customers and creditors. If a debt resolution program is accredited with one or both of these organizations, it speaks to their credibility and legitimacy in the industry.

Customer Service & Communication

Our top picks are all companies that have a good reputation for customer service. You should be able to contact the company by phone, chat, email or text (or all of the above), and they should be responsive to your questions. Bonus if there’s an online dashboard so you can monitor your progress as you go.

Success Rates & Reviews

We look for a company’s success rates, favoring companies with a long history of successfully helping people with their debt.

​​We comb through reviews and ratings on trusted sites like the Better Business Bureau (BBB) and Trustpilot to assess the general public sentiment from current and former customers of each debt resolution service. Occasional bad reviews are typical, but consistent negative patterns may warrant concern. 

We also look for how the company addresses complaints, and whether they take action to resolve them. When looking through positive reviews, we specifically seek out reviews from those who have completed the debt process and can speak to their results, as well as new customers who can primarily speak to the sales process and their initial impressions of the company.

How to Choose a Debt Resolution Program

If you’re ready to pursue your goal of financial freedom with a debt resolution program, here’s what to do to get started:

• Research multiple companies: Or better yet, take a peek at our thorough, vetted reviews of the best debt resolution programs.
• Compare services and fees: Make sure that the company offers a range of services and has a reasonable fee. Avoid companies with vague or excessively high fees.
• Ask questions: Prepare a list of questions for your initial consultation, including what services are offered, how the company evaluates your financial situation and what their average success rates and timelines are. A reputable company will be upfront and transparent with their answers.
• Review contracts carefully: Before signing any agreements, make sure you read the contract carefully and understand all the terms and conditions. Look for clauses that may lead to unexpected costs. 

Be wary of companies that make promises that sound too good to be true. There are several “reg flags” to look out for, including:

• Pushy or aggressive sales tactics
• Upfront or excessive fees
• Promises or guarantees of success
• Lack of transparency
• Repeated negative customer reviews