3 Best Debt Settlement Companies (Feb. 2024)

Debt Settlement Companies

Some things in life get better over time. Fine cheeses, for example, gain a delectable sharpness and bite as they age. But time isn’t kind to all things — old eggs simply spoil, rather than gaining any depth of flavor.

Unfortunately, debt is something that falls into the latter category; letting it sit only allows it to grow in size and seriousness, until, one day, it is an unmanageable behemoth threatening your financial — and, often, mental — well-being.

Debt settlement is a common choice for those whose finances have soured over time, leading to debt they simply can’t repay. But while debt settlement companies can help reduce the amount of money it takes to become debt-free, particularly if you use a reputable service, it’s often not the only solution.

Top Companies | What to Expect | Types of Debt Relief

Top Debt Settlement Companies

As with any company that will be influencing your credit and finances, you’ll need to research your debt settlement company thoroughly before entering any agreements. Be sure to check its reputation, such as with sites like the Better Business Bureau.

You should also investigate the company’s reputation with former customers. At its heart, debt settlement relies on a negotiation between your debt management company and your creditors, so make sure your chosen company has the ability to handle that negotiation successfully. You can start your search with our expert-rated picks below.

  • Requires $10,000 or more in credit card debt
  • Free, no-obligation debt analysis
  • Specializes in credit card and medical debt
  • Also handles debt from personal loans, private student loans, lines of credit, and collections
  • Does not handle IRS, utility, federal student loans or mortgage debt
  • Long-term program to relieve debt over 24-48 month period
  • See official site, terms, and details.


Overall Rating

Better Business Bureau In Business Since Free Consultation? Reputation Score
A+ 2009 Yes 9.5/10
  • 100% confidential, no-obligation consultation
  • Specializes in unsecured debts over $10,000
  • In business since 2000
  • Options for debt settlement, consolidation, and tax debt
  • Get a 100% free, personalized savings estimate from a debt professional
  • See official site, terms, and details.


Overall Rating

Better Business Bureau In Business Since Free Consultation? Reputation Score
(No Grade) 2000 Yes 9.0/10
  • Toll-free assessment: 1-855-299-9573
  • Minimum $10,000 in debt required
  • Learn about your debt relief options
  • AFCC accredited member
  • Resolve debts in as little as 24 to 48 months
  • $5 Billion in debt resolved – #1 in America
  • See official site, terms, and details.


Overall Rating

Better Business Bureau In Business Since Free Consultation? Reputation Score
A+ 2002 Yes 9.5/10

One important red flag of which to be wary is companies that make promises about your debt before you even start the settlement process. A debt settlement company can’t know whether your lender will accept a particular offer until it’s made, and any guarantees a debt settlement company makes that say otherwise are likely marketing ploys.

Additionally, beware of companies that try to charge you fees before you even sign anything. Many reputable companies will offer free consultations to determine if debt settlement is the right solution before trying to sell you any products or services.

What to Expect from Debt Settlement

At its most basic, the debt settlement process will require you to make regular payments to the debt settlement company, which are set aside in a dedicated savings account. The payment amount and frequency will be determined by you and your representative.

Once your account balance reaches an amount that the debt settlement company believes your creditor will accept, the company will make an offer to your creditor to settle your debt.

In many cases, creditors — or, as may be the case at this point, collection agencies — will accept less than what is owed so they no longer have to chase the debt and spend resources trying to collect the full amount.

Collection agencies, in particular, often purchase debts for less than the face value, so the amount they need to make a profit will be lower than the total amount owed.

Graphic Showing How Debt Settlement Works

Of course, acceptance of a debt settlement offer is never guaranteed. Some creditors may request a larger amount, or they may not accept the offer at all. If even a portion of your debts are settled, however, you’ll usually still be on the hook for services rendered by your debt settlement company, regardless of whether some debts remain unsettled.

If you have the ability to save the money yourself, you can try to negotiate with your creditors yourself. While this will require discipline — you’ll need to save up a reasonable amount to offer them — it can cut out the expensive middleman.

Although debt settlement can seem ideal because of the potential for getting out debt paying less than you owe, debt settlement does have drawbacks. For one thing, making payments to your debt settlement company doesn’t stop your debt from growing, nor does it stop collection calls and letters.

Additionally, debt settlement can have severe credit score impacts. Some debt settlement companies may encourage you to stop paying your creditors until settlement is complete; while this can give you extra money to save toward settlement, it can also mean many delinquent accounts on your credit report — which can cost you dozens of credit score points.

Other Types of Debt Relief Programs

Given the potential costs — both monetary and to your credit — of using a debt settlement company, you should first consider other types of debt relief that may have fewer consequences.

Indeed, long before attempting debt settlement, you should first look into other debt management programs. Depending on your situation, simply entering a credit and debt counseling program can help you build a management plan that can get your debt under control.

Debt consolidation can also be a better alternative to debt settlement. Successful consolidation will not only simplify your finances, but can help you obtain lower interest rates, making repayment easier and debt freedom more attainable.

In general, consolidating your debt will be done via a personal installment loan or a credit card balance transfer — or both.

Personal installment loans are likely the most common product used to consolidate debt. Basically, you’ll obtain a loan with a lower APR than you’re currently being charged and use that loan to pay off your existing debt. You’ll then pay off your new loan each month. Since the key is to find a low APR, be sure to compare your options, perhaps with an online lending network like those below.

Credit card balance transfers work best when you can obtain a card with a low regular APR or, better, an introductory 0% APR offer. Because these offers typically require at least good credit, balance transfers may not be an option for everyone.

Bankruptcy can also be a viable solution in some cases — but only as a last resort. A bankruptcy discharge on your credit report is the ultimate red flag, and it can make obtaining new credit extremely difficult — and expensive — for up to a decade.

Get Your Debt Under Control with the Right Program

While many things can benefit from time — like a well-aged bottle of liquor — your debt, unfortunately, is not one of them. Unless you’re aggressively paying it off, time will only make your debt grow larger and less manageable.

No matter what type of debt management you choose, it’s better to start sooner than later. The longer your debt has to grow, the harder it will be to pay it off — and the more damage it can do to your credit score in the meantime. So, let the cheeses and refined spirits age and turn your attention to outstanding debts. While certain well-aged cheeses can transmit some foul odors, what really stinks is being buried under the weight of debt.

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