Debt Consolidation
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Freedom Debt Relief Review

Updated on:
Content was accurate at the time of publication.
 Our verdict: While Freedom Debt Relief may help you get out of debt at a lower cost than what you owe, there are some drawbacks to debt settlement — it can hurt your credit score, for example.

Freedom Debt Relief, formed in 2002, is one of the country’s largest debt settlement companies. It helps debtors manage their debt burden and negotiates with creditors on their behalf.

  • Will likely hurt your credit score: Like with any debt settlement company, working with Freedom Debt Relief will typically make your credit score drop at first. Depending on your situation, it could be a significant tumble.
  • Works with unsecured loan debt: Freedom Debt Relief works with unsecured debt, like a credit card or personal loan, which isn’t backed by collateral. Secured debts like mortgages or auto loans and federal student loans cannot be paid out through Freedom Debt Relief.
  • Charges a 15% to 25% fee: Debt settlement companies aren’t legally permitted to accept upfront fees, but you will eventually have to pay Freedom Debt Relief for its services. They charge 15% to 25% of your enrolled debt once you start paying settlements.
  • Not available in some states: Freedom Debt Relief is authorized to do business in less than half of U.S. states. It is available in some bigger states like California, Texas and Florida.
  • Other options for debt management: Freedom Debt Relief may also refer you to debt consolidation lenders if that strategy makes more sense, given your financial situation.
  • Best for assisted debt settlement: If you need help sorting out your debts, especially if they’re at risk of being sent to collections already, Freedom Debt Relief may help you manage everything and reduce the total amount you owe.
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Freedom Debt Relief offers debt settlement programs, as well as other services, for debtors with an unmanageable amount of unsecured debt. Its debt relief program can simplify your monthly payments and negotiate the amounts you owe.

If you sign up for Freedom Debt Relief, you won’t have to pay any upfront fees — but you will have to pay a percentage of your debt to Freedom Debt Relief during the process.

As part of the program, you essentially hand over control of your debts to Freedom Debt Relief and make payments into a Federal Deposit Insurance Corp.-insured bank account instead of your creditors. The company then negotiates with your creditors on your behalf.

If they agree to new terms on a debt, you’ll be given the option to approve that settlement. In the meantime, your credit score will probably take a big hit as you miss payments (plus your debt could be sent to collections). Freedom Debt Relief estimates its debt relief program takes two to four years on average.

Freedom Debt Relief advertises that it lowers the overall debt burden for its clients, but it cannot guarantee that you’ll pay a lower amount in the end. Creditors are under no obligation to work with a debt settlement company like Freedom Debt Relief, and they can continue charging fees or eventually sue you to collect those debts.

There’s a chance you could tank your credit score without resolving your debt, and you could wind up owing more than you would have if you’d continued paying off the debt.

Debt settlement programs are heavily regulated by the federal and state governments, and they may hurt you in the long run if you don’t keep up with the required payments. But, as long as you follow its guidelines and recommendations, Freedom Debt Relief may reduce your debt and help you pay it off.


  Resolves your debts within 24 to 48 months, on average

  Negotiates with your creditors directly so you don’t have to

  Simplifies your debts into one single monthly payment

  Could cause significant damage to your credit score

  Won’t prevent creditors or debt collectors from contacting you

  Charges a fee ranging from 15% to 25% of your enrolled debt amount

One of the biggest advantages of Freedom Debt Relief is that it may make things much more straightforward. If the company is successful in renegotiating your debts, you won’t have to juggle the demands of various creditors and decide how to pay each one.

Instead, you’d contribute to an account held with Freedom Debt Relief, and they would sort out your debts for you. While you could try to negotiate those debts yourself, the company has much more experience dealing with creditors and more than 200 debt negotiators on staff.

There are trade-offs, however. Debt settlement programs usually encourage you to ignore creditors while they negotiate, which can be difficult. Chances are your credit score may have already taken a dive due to missed payments, but it will continue to drop further as you work with Freedom Debt Relief as part of its debt settlement program.

Paying off your debt in this way might seem more important, but the damage to your credit score can last for years. Settled debts also stay on your credit report for up to seven years and impact your future access to credit.

Ultimately, you’ll have to decide whether those trade-offs are worth it or if you’d be better off pursuing an alternate strategy to debt settlement. Freedom Debt Relief does provide some of those alternatives during the evaluation process.

Freedom Debt Relief works with individuals with unsecured debt. Many of its clients have experienced some financial hardships that have made debt payments difficult.

You can work with Freedom Debt Relief if you live in one of the following states: Arizona, Arkansas, California, Colorado, Delaware, Florida, Idaho, Indiana, Iowa, Kentucky, Maine, Maryland, Minnesota, Mississippi, Missouri, Montana, Nevada, Pennsylvania, South Dakota, Tennessee, Texas or Utah.

Otherwise, the company isn’t authorized to do business where you live.

Freedom Debt Relief promotes a simple process for debt relief. In the beginning, you’ll need to provide information about your debts, including how much you owe and to whom. From there, you’ll start the process:

  • Receive a free debt evaluation. Freedom Debt Relief will ask questions about your situation and develop a debt relief plan that fits your goals and ability to make payments.
  • Deposit money into an account. The company uses a dedicated account to fund future debt settlements, and you’ll start making monthly deposits.
  • Approve negotiated settlements. Freedom Debt Relief will notify you when they’ve negotiated a debt settlement with a creditor, and you’ll choose whether to approve that offer.
  • Pay off your debts. If you’ve approved a settlement, Freedom Debt Relief will make automatic payments from your dedicated account to your creditor to pay off the debt.

CompanyFreedom Debt ReliefAmericorAccredited Debt Relief
Minimum debtNot disclosed$10,000Not disclosed
Fees15% to 25% of enrolled debt14% to 29% of enrolled debtTypically 25% of enrolled debt
Timeline24 to 48 months24 to 48 months24 to 48 months
Types of debtUnsecured debtsUnsecured debtsUnsecured debts

Debt settlement programs aren’t right for everyone. In some cases, you may be better off with a different plan for paying off your debts, especially if you want to preserve your credit score. With most plans, you’ll have to start saving and making a regular payment; otherwise, bankruptcy may be an option of last resort.

  • Debt consolidation loans. If you’re struggling with credit card debt, debt consolidation loans often have a lower APR and monthly payment. Refinancing your debt may help you pay off your existing creditors right away, but you’d have a new loan to manage.
  • Credit counseling programs. Certified credit counselors can help advise you on your debt and help you come up with a plan for paying it off. These nonprofit services also help you get on solid footing by giving you budgeting and money management tips.
  • Negotiate debts yourself. You don’t necessarily need someone to negotiate debts with creditors on your behalf. You’ll need to be prepared, but if you’ve fallen on hard times, there’s a chance you could agree to a reduced payment structure to help pay off your debts.
  • File for bankruptcy. If your debt has truly become insurmountable, filing for bankruptcy may help you discharge many unsecured debts, including credit card debt. Consult with a bankruptcy attorney before deciding to take this step.

Freedom Debt Relief is an accredited debt settlement company with the American Association for Debt Resolution that provides legitimate services to thousands of Americans.

Yes, Freedom Debt Relief will eventually cost a percentage of the amount of debt you’ve enrolled in the program, but there are no upfront fees.

Yes, you can cancel Freedom Debt Relief at any time and access the money you’ve saved as part of the program, but doing so could wind up putting you further behind in debt.