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5 Best Debt Settlement Companies of 2023
- Over $10 billion in debts settled
- No fees until results are obtained
- Free, personalized evaluation from certified debt specialists
- 90% positive ratings with the BBB
- Settle your debts for significantly less than you owe
- Reduce debt in 24-48 months
- No fees until settlement is reached
- Money-back guarantee
- Minimum debt: $7,500
- One low monthly payment
- Reduce debt in 24-36 months
- No upfront fees
- BBB A+ rating
- Over $250 million in debt settled since 1999
- Get a free debt analysis
- Resolve debt in 2-4 years
- No upfront fees
- Minimum debt: $7,500
- Personal account managers and certified debt specialists
- A+ rating with BBB
- Reduce debt in 24-48 months
- No upfront fees
- Money-back guarantee
- Minimum debt: $7,500
- Get a free savings estimate

If you’re overwhelmed by debt and can’t make your minimum payments each month, you may start wondering how you’ll ever regain your financial footing.
Luckily, you have options.
One such opportunity comes in the form of debt settlement. This process entails negotiating with your creditors to lower your interest rates and reduce the amount you owe. Typically, you pay in a lump sum, and the debt is considered settled.
5 Best Debt Settlement Companies
Debt settlement companies primarily work with credit card debt. However, there are other types of debt they work with and some they don’t work with at all.
While you certainly can attempt to negotiate your settlement on your own, you may have better results by working with a professional debt relief company. Like debt consolidation loans, working with them allows you to pay one bill at a lower interest rate.
There are many debt relief programs and debt settlement companies that can help you consolidate your debt. The best debt settlement companies can help you avoid bankruptcy by settling your debts for less than what you owe. But with so many debt relief options to choose from, picking the right debt settlement company isn’t always easy.
We’ve rated each debt relief program on factors such as fees, reviews, minimum debt amount, company reputation, and average repayment period. Here are our top debt settlement companies for 2023.
Freedom Debt Relief
While Freedom Debt Relief takes charge of the debt settlement process on your behalf, you ultimately get to retain control of all decision-making.
Accredited Debt Relief
With a five-star Trust Pilot review, Accredited Debt Relief is certainly a popular option for getting your debt settled. And they offer a slightly different service than the typical debt settlement company.
New Era Debt Solutions
Established in 1999, New Era Debt Solutions operates throughout most of the country with a reputation for strong customer service.
Pacific Debt Inc.
Based in San Diego, California, Pacific Debt Inc. has spent over 15 years helping clients settle their debts. They work with you to create a debt management plan that works within your budget so that you don’t feel completely overwhelmed by your obligations.
National Debt Relief
One of the nation’s largest debt settlement firms, National Debt Relief utilizes seasoned professionals to help tackle your debt problems. Their employees include professional debt arbitrators, negotiators, and a stellar customer service department.
How do debt settlement companies work?
A debt settlement company is a business that helps customers with unmanageable debt by negotiating for debt settlement on their behalf. The purpose of the debt settlement process is to convince creditors to settle for a portion of the debt balance. This will ultimately make your debt management plans much easier to follow.
Typically, when working with a debt settlement company, they will ask you to save a certain amount of money in a dedicated savings account. This is to build up a lump sum of money that you’ll use to pay your creditors. When the amount you’ve saved is sufficient, the debt relief company will approach your creditor on your behalf.
The debt relief company will negotiate with the creditor and try to convince them to settle for a one-off partial repayment of your debt obligation. If they don’t settle, and you file for bankruptcy instead, they risk receiving no payment at all. The money you’ve saved will be withdrawn by the debt relief company to pay the negotiated debt settlement.
If the debt relief company successfully negotiates with your creditor, they take a percentage of your debt to pay for their debt settlement services. Some debt settlement companies will also charge maintenance fees for their customers’ savings accounts.
How to Pick the Best Debt Settlement Company
There are a lot of debt settlement companies out there, so how do you choose the best debt settlement company for you?
There are several factors to consider. First, think about how severe your debt issues are. You should only consider debt settlement if you’re on the brink of bankruptcy or can’t see a path out of debt anytime soon. You could even talk to an independent credit counselor about your options.
Once you narrow down your options with a professional debt settlement company, first look at the qualifying requirements. You’ll typically need to meet a minimum amount of debt, which usually has to be unsecured.
Debt Settlement Fees
Next, look at the fees. Don’t rely on testimonials and online reviews. You need to call each debt relief company you’re considering and get a quote based on your financial situation. This can help narrow down your options, and you can do it with a free phone consultation.
Monthly Payments
Finally, determine how much your payments will be and how long the debt settlement company expects the process to take. You must find a healthy balance between aggressively funding your debt settlement account while not taking on a new (and unnecessary) financial burden.
Once you’ve compared your options, you can get started on the road to debt relief. It may take some time, but in many cases, it can lead to a much more promising financial future.
Accreditation
Accreditation can provide valuable insights into a debt settlement company’s reputation and the overall quality of their service. For debt relief companies to become accredited, they must meet standards set by the accrediting organization body and the industry they serve.
The American Fair Credit Council (AFCC) is the leading association protecting consumer rights for the debt settlement industry. So, it’s wise to check to see if the debt relief company you’re considering is a member of the AFCC. If a company is a member of the American Fair Credit Council, you can expect high standards of customer service. This is because they promote consumer rights for Americans with high debt obligations.
Impact on Your Credit Score
Just know that debt settlement can damage your credit score significantly, so you should only consider it in extreme circumstances. Debt relief companies will also advise you to stop making payments on your debts, which can result in late fees and collections calls.
Another impact to consider is that you’ll almost certainly need to pay taxes on any amount that is settled. It’s considered part of your income, so make sure you account for this increase when filing your taxes.
As with any bank or other financial services company, it’s essential to choose your debt settlement company carefully. After all, they’re helping to manage your money and represent you in front of your creditors.
What Can Debt Relief Services Help With?
Credit Card Debt
Unsecured credit card debt is the most common kind of debt. Credit cards can allow people to spend way above their means. Your credit score can suffer and you can accumulate considerable debt if you continue to do this. Most debt settlement companies can provide solutions for credit card debt.
Personal Loans
If you default on a personal loan from a bank, credit union or other lender, they usually start charging late fees after about a month. This will cause your credit score to drop quickly as the debt builds. Debt settlement services are adept at providing debt consolidation for personal loans.
Medical Debt
If you don’t pay your medical bill within a certain amount of time, it’ll go to collections. Medical bills are an increasingly common form of debt owed. Freedom Debt Relief is one of the standout choices when it comes to debt consolidation for medical bills.
Unsecured Debts
Unsecured personal loans are any type of personal loan that doesn’t involve collateral. Many of the top debt relief companies can provide unsecured debt consolidation, including some we’ve reviewed above.
Alternatives to Debt Settlement Companies
If you’re on the fence about working with a debt settlement company, you may want to consider some alternatives to weigh your options. Of course, each strategy has its pros and cons, and only you can decide which option will be best for you.
Negotiate Your Own Debt Settlement
Some experts say that working with a debt settlement company will prolong the process and cost you more money overall. They may also ask you to stop paying your creditors until the settlement is over, which can negatively affect your credit.
On top of that, some credit card companies refuse to negotiate with debt settlement companies. For that reason, you may want to negotiate with creditors and settle your debt on your own.
Debt Consolidation Loans
Like a credit card balance transfer, getting a debt consolidation loan allows you to consolidate credit card debt and make one monthly payment. The best way to do this is to find an unsecured loan with a lower interest rate than your current credit cards. This can speed up the process and make it easier to manage.
Credit Counseling
Reputable nonprofit credit counseling agencies work with you to create debt management plans or budget to help you better manage your money. In addition, experts will go over debt repayment options with you to help you achieve your financial goals.
Bankruptcy
As you’ve probably heard many times, filing for bankruptcy is a last resort. The consequences of filing bankruptcy can be severe and affect your life for up to 10 years. The nice thing about bankruptcy is that it’s a relatively quick process, most of your debts will be forgiven, and you’ll be given a fresh start.
Neither bankruptcy nor debt settlement will help you with student loan debt. However, if most of your debt consists of student loans, there are better options available.
Bottom Line
Remember that debt settlement is a significant decision to make. It should always be considered a last resort to avoid filing for bankruptcy.
For that reason, make sure you allow yourself the time to weigh your decision carefully. It might help to seek professional advice via a credit counseling agency, or from a financial advisor. And if you do decide to move forward with a debt settlement company, make sure you understand the fees, expectations, and any other risks involved.