Freedom Debt Relief Review: A Reputable Debt Settlement Company

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Freedom Debt Relief Review: A Reputable Debt Settlement Company

We recommend Freedom Debt Relief as a last resort option for those only looking for debt settlement services. If you require additional services like credit counseling, we'd recommend looking elsewhere.

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Freedom Debt Relief is one of the most reputable debt settlement companies in the U.S. If you have a large amount of outstanding debt, its debt settlement program may help you negotiate with creditors to lower your outstanding unsecured debt balances.

While Freedom Debt Relief can help consumers clear their debts, there may be better solutions. With the high cost, potential negative impact on your credit and no guarantee of a resolution, using Freedom Debt Relief may not be the best choice. So, if you’re deep in debt, you should consider all of your options before partnering with a debt settlement company.

Freedom Debt Relief review

Freedom Debt Relief offers debt relief services for unsecured debt. Unsecured debts include personal loans, medical bills, credit card balances and some private loans. To qualify, you must have at least $7,500 of outstanding unsecured debt. Freedom Debt Relief does not offer debt settlement for secured debts, such as a car loan or mortgage.

If you’re unable to make payments or are suffering from a hardship and have more than $7,500 of unsecured debt, Freedom Debt Relief’s debt settlement program may be tempting to consider.

If you've already made the choice to partner with a debt settlement company, we'd recommend Freedom Debt Relief largely due to the fact that it is a reputable company. With the high numbers of scams in the debt settlement space, it's best to go with a reputable company. However, partnering with debt settlement companies in general has its risks.

These programs can come with high fees and can negatively impact your credit. In addition to the cost of using this program to settle your debt, creditors may continue to contact you or even increase their efforts to gain resolution. Some creditors may seek legal action for repayment. Freedom Debt Relief claims they offer support for these types of situations, but you may still be at risk of ending up in a worse situation than you were before.

Despite Freedom Debt Relief's relatively strong reputation, it is far from perfect. For example, the Consumer Financial Protection Bureau filed a lawsuit against Freedom Debt Relief in 2017 citing a variety of allegations, including:

  • Charging clients without actually settling their debts
  • Misinforming clients about the fee structure
  • Failing to let clients know their rights to the money deposited in their account with the company

Additionally, Freedom Debt Relief doesn't offer too many options outside of simple debt management. If you're looking for other services like credit counseling, we advise you to consider other debt settlement companies.

How does Freedom Debt Relief work?

Freedom Debt Relief offers a debt relief and settlement program. Trained debt professionals work on your behalf to negotiate your debt with creditors.

First, you’ll have a phone call with one of Freedom Debt Relief’s certified debt consultants where the consultant will go over your finances and assess possible solutions. If you decide to move forward with this debt settlement program, they will help you create a tailored debt repayment plan.

Usually, at this point you will stop making payments on your debt and instead make payments to a dedicated account under your control. Once your account has sufficient funds, Freedom Debt Relief will start the debt negotiation process with your creditors, meaning that they’ll ask your creditors to accept a lower payment for the debt you owe. The risk here is that you're stopping payments on your existing debt for an uncertain amount of time, which can damage your credit score.

If they reach an agreement with your creditors, you’ll be asked to approve the settlement amount. Then the funds from your dedicated account will be transferred to the creditor as payment for your debt. This practice will repeat until all debt balances are cleared. Freedom Debt Relief says the process typically takes 24 to 48 months, but individual time frames may vary.

Freedom Debt Relief terms and fees

Debt amountMinimum of $7,500
Fees15 - 25% of total settled debt
Time frame24 - 48 months

Freedom Debt Relief does not charge an upfront fee for debt settlement. However, they charge between 15 - 25% of total settled debt. According to the company, the amount varies depending on your state of residence.

For example, if you had $7,500 of outstanding debt and Freedom Debt Relief was able to settle $4,000 of debt, you would owe between $600 and $1,000 for this service.

Also, keep in mind that the IRS considers all forgiven debt to be taxable income, unless you are insolvent. Being insolvent means your total debt exceeds your total assets. It’s wise to meet with a tax professional to see if you are considered insolvent. But even if you don’t qualify, paying taxes on the amount of forgiven debt may still less than paying the total amount you originally owed. This is another important consideration when determining if debt relief is right for you.

Freedom Debt Relief pros and cons

While Freedom Debt Relief may help you get rid of your debt for good, it also comes with some risks. Here’s how that balances out.


  • Lower debt
  • Can be a useful last resort option
  • Reputable name and the largest debt settlement company in the U.S.
  • Standard debt settlement fees


  • Freedom Debt Relief has landed in hot water with regulators in the past
  • No additional services like credit counseling
  • No guarantee that debt can be settled or lowered

How does Freedom Debt Relief compare to other services?

In comparison to other debt relief companies, Freedom Debt Relief may not offer as much transparency or customer satisfaction as others. In regards to cost, Freedom Debt Relief’s fees are pretty standard across the industry.

While Freedom Debt Relief tends to focus on its debt settlement program, other debt relief companies may offer a wider variety of services. Here are some of the services you may expect to see with other debt management companies:

  • Credit and debt counseling: Counseling services help solve your money problems through the use of various tools and resources. Counselors may help you develop a tailored plan to reach financial security. They may connect you with financial programs or help you plan a budget. You may find inexpensive debt counseling services with nonprofit groups, financial institutions or religious organizations.
  • Debt consolidation: When you consolidate your debt, you roll all of your balances into one monthly payment. Consolidating your debt may help you lower your monthly payments and reduce the amount of interest you owe. The National Foundation for Credit Counseling and Financial Counseling Association of America can help you find agencies that can determine if this is the right solution for you.
  • Bankruptcy counseling: If you’re unable to pay your creditors, another option is to file for bankruptcy. Filing for bankruptcy is a process that helps you sell your assets to pay your debts or assists you in making a repayment plan to move toward debt freedom. The U.S. Department of Justice requires counseling by an approved agency before filing for bankruptcy. In some cases, this service may develop an alternative plan to bankruptcy.

Explore all of your options before making a decision. You may discover there are other options that can help you clear your debt for a fraction of the cost of debt settlement.

Freedom Debt Relief vs. GreenPath Financial Wellness

GreenPath Financial Wellness is a nonprofit organization that offers a variety of debt management services including free financial counseling and educational resources.

GreenPath offers a debt management plan. With GreenPath’s debt management plan, you can consolidate your debt into a single payment. However, this plan will not settle your outstanding debt. The goal of the program is to help you lower your interest rate and accelerate your debt repayment by consolidation.

GreenPath charges up to $50 to set up a debt management plan and then charges up to $75 per month. The exact amount depends on the state you live in and the debt amount. There does not appear to be any restriction on the types of debts GreenPath will work with or a minimum amount of debt required.

Unlike Freedom Debt Relief, GreenPath offers additional services other than debt management to help consumers get back on their feet financially. These services may give you alternative solutions to better manage your debt.

Freedom Debt Relief vs. National Debt Relief

Like Freedom Debt Relief, National Debt Relief is one of the largest U.S. debt settlement companies.

National Debt Relief’s debt relief program is also focused on unsecured debts, just like Freedom Debt Relief. Similarly, you must owe more than $7,500 to pursue debt settlement with National Debt Relief. National Debt Relief also charges a 15 - 25% of the amount of the enrolled debt.

Freedom Debt Relief vs. National Foundation for Credit Counseling

The National Foundation for Credit Counseling is a nonprofit organization that helps connect consumers with credit and debt counseling agencies, thus helping them better manage their money. These agencies may provide credit counseling or a debt management plan based on their clients’ financial needs.

With credit and debt counseling, the NFCC connects consumers with credit counseling agencies to help them make their debt more manageable. Each agency may have a different process for credit counseling.

The NFCC also helps connect consumers with debt management programs offered by one of their NFCC-certified agencies. Similar to credit counseling, each agency may have a different process and program for helping with debt management. That said, fees, terms and services may vary by agencies.

Unlike Freedom Debt Relief, this organization doesn’t offer any services directly to consumers. Instead, they help you find an agency in their network that can help you meet your debt repayment needs. Freedom Debt Relief primarily focuses on their debt relief program.

Freedom Debt Relief vs. Financial Counseling Association of America

The Financial Counseling Association of America is an association of agencies that represent debt management and counseling services. These services help consumers with many financial problems, including bankruptcy and housing issues.

Similar to the NFCC, the FCAA doesn’t provide services directly. They connect you with one of their agencies to fulfill your debt management needs. Their agencies offer a wide variety of services to help manage debt. These services can include free credit counseling and education, the creation of debt management plans, personal loan consolidation, and more.

So, if you’re struggling to pay off your debt, the FCAA can connect you with one of their agencies to help you get on track with your finances. FCAA agencies offer free counseling, education, and other options and programs to help you get out of debt.

In contrast, Freedom Debt Relief offers its services directly to consumers. Their primary focus is on debt settlement and relief.

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