Frequently Asked Questions

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Is Freedom Debt Relief a scam?

No. Freedom Debt Relief is a legitimate company that has helped tens of thousands of clients since we started in 2002. We are a founding member of the American Fair Credit Council (AFCC) and a platinum member of the International Association of Professional Debt Arbitrators. Every day, our dedicated employees carry out our mission to help people solve their debt problems — even if the solution they choose isn’t Freedom Debt Relief. Learn more about our commitment to integrity and our accreditations.

What if I can’t get a big enough loan to consolidate all of my debts?

Fortunately, you can still improve your financial position with a debt consolidation loan. First, list your debts – the interest rate, balance, and monthly payment. If reducing your interest rate is your primary goal, rank the accounts by interest rate, Consolidate the balance with the highest rate, then the next highest, and so on. 

If you need to reduce your total monthly expense, add another column to your list. For each account, divide the monthly payment by your current balance to get your payment percentage. You'll achieve the greatest payment reduction by consolidating the accounts with the highest payment percentage.

Does the free site provide free credit scores?

You can visit the federal government's site to get your free credit reports from Equifax, Experian, and TransUnion once per year. does not provide free credit scores, however.

How can I get a debt consolidation loan?

First, decide what kind of loan you want from the options described in this article. Then compare rates from banks and other lenders to see who has a good deal. The rate you get depends on your financial situation, so don’t commit to a loan until you have a specific quote. 

How does debt relief affect my credit?

Our goal is to help you get out of debt as fast as possible by negotiating with your creditors to get them to accept significantly less than face value on your unsecured debts. Depending on the condition of your credit report at the time of enrollment, any debt settlement or debt negotiation program, including ours, could negatively affect your credit. Negative information could remain on your credit report for up to seven years. By engaging in good credit behavior, anyone’s credit score could recover over time. Results vary depending on your payment history, credit utilization, length of credit history, and debt-to-income ratio.

If getting out of debt is more important to you than the likelihood that your score will be negatively impacted, our program could help you resolve your debt faster and for less—without declaring bankruptcy.

How can I tell if a debt consolidation loan will save me money?

Any loan should come with an amortization schedule. The schedule lays out all the payments you would make over the loan, broken into principal and interest. This makes it easy to see the total cost over the life of the loan. Compare that cost to the cost of doing nothing and continuing to pay your accounts.

How do I know if amounts forgiven through debt relief would be taxable for me?

According to the IRS, forgiven debt is taxable income and you should receive a Form 1099-C (cancellation of debt). You can get out of paying tax on forgiven debt if you discharge it n a bankruptcy proceeding or if you’re “insolvent.”

But how do you know if you’re insolvent or not? It’s actually a very simple calculation – what you own (assets) minus what you owe (liabilities). If your liabilities exceed your assets, you’re insolvent.

For example, if you own a house worth $200,000, a car worth $25,000, and personal property worth $25,000. Your total assets are $250,000. And if you have a $180,000 mortgage balance, a $15,000 auto loan, $10,000 in credit card balance, and a $50,000 student loan, your liabilities equal $255,000. Because your liabilities exceed your assets by $5,000, you’re $5,000 insolvent. That means you’d not owe taxes on up to $5,000 in forgiven debt.

What is the highest credit score possible?

Generally, the highest credit score possible for consumers on the FICO and VantageScore models is 850. An 850 credit score is considered to be perfect credit. However, some score models go as high as 900, though these are only used in very specific lending scenarios. 

Are all free credit scores the same?

Free credit scores are not all alike. Some free credit scores are issued by FICO; others are VantageScores. There can be wide variations in free credit scores, depending on which credit bureau furnishes the information for them and which scoring model is used. 

Is it possible to get a perfect 850 credit score?

An 850 credit score is possible, though only a small percentage of Americans have a score this high. Reaching an 850 credit score comes down to how you use credit. Paying on time, keeping credit utilization low, having older credit accounts, and limiting how often you apply for new credit can help you to get closer to the perfect score range. 

Can I buy a house after debt settlement?

In most cases, debt settlement does immediate and sometimes extensive damage to your credit history and credit scores. You will probably have difficulty getting a mortgage immediately after debt settlement. However, credit scores tend to climb after graduation from a debt settlement program. If you stay out of debt, pay your bills on time and rebuild your credit scores, you should be able to qualify for a mortgage in the future. And it may not take as long as you think. 

Will I be totally debt free when I am done?

Our program is focused on dealing with unsecured debts (credit cards, medical bills, unsecured personal loans, etc.). We can’t help with debt that is secured by collateral (such as mortgages or auto loans). However, after completing the program, the money you had been paying towards your unsecured creditors can be used to pay down secured debts and start saving for your financial future. Not everyone completes our program, so remember that sticking to your monthly savings plan is the most important factor in determining your success.

How do providers of free credit scores make money?

Free credit score providers can make money by offering paid financial services or products. For example, you might be able to get your credit score for free and receive recommendations for loans based on that score. If you apply for the recommended loan, the credit score provider may receive a commission from the lender. Providers also get a lot of valuable information from you in exchange for your score, and they may use it themselves or sell it to marketing companies.

Will debt collectors call me?

There are federal and state laws designed to protect you from collections harassment, but the fact is most of our clients will experience some collections calls. To help, we offer tools and guidance on how to handle those interactions. Learn more about laws that regulate debt collector behavior here.

What happens if I never pay my student loans?

If you fail to pay student loans, the debts can become delinquent. Delinquencies can show up on your credit reports and harm your credit scores. Defaulting on federal loans can result in liens or an offset of your tax refund. Private student loan lenders can sue you for unpaid debt. It is possible, although very difficult, to discharge student loans in bankruptcy.

What is the lowest credit score?

The lowest credit score on both the FICO and VantageScore ranges is 300. Someone with a 300 credit score has very low odds of getting approved for loans or lines of credit. Other scoring models go as low as 250. It’s even harder to get the lowest credit score than it is the highest – according to TransUnion data, only .01% of scoreable consumers have a 300 FICO score. 

Is it safe to use a home equity loan to pay off credit card debt?

A home equity loan does raise the stakes because it uses your home as collateral. So, before you use any type of mortgage for debt consolidation, check to see how the monthly payments would fit into your budget. Also, consider factors like whether you have any savings to draw on in an emergency and how secure your income is. 

Is it possible to have no credit score at all?

You won’t have a credit score if you’re deemed “unscorable.” According to MyFICO, these are the minimum requirements to generate a score:

  • At least one account opened for six months or more, and

  • At least one account reported to the credit bureau within the past six months, and

  • No indication of deceased on the credit report 

You may meet guidelines with a single account or multiple accounts on a credit file.

How long does a debt settlement stay on your credit report?

When you settle one of your debts, your creditor will update the status of your account to Settled, or some variation thereof.This status could stay on your credit report for up to seven years. Having an account settled has less of a credit impact than having an account with the status of Unpaid, but both are considered negative marks to your credit. However, by engaging in positive credit behavior over time, you may be able to improve your credit standing.

Is Freedom Debt Relief any good?

Yes! Freedom Debt Relief is committed to providing excellent service to our clients while we help them resolve their debt. Over 600,000 people have enrolled in our debt settlement program, so we must be doing something right. You can find reviews and success stories from clients we’ve helped overcome debt. But don’t just take our word for it: thousands of our clients have left glowing reviews of us on websites like TrustPilot and Consumer Affairs.

How much does debt relief cost?

In our program, clients pay no fees whatsoever until a debt is negotiated. You will know when fees are charged because you will approve every deal. Once we reach a settlement with a creditor, we immediately contact you for authorization. After you authorize the settlement, the fee associated with the debt is processed. All fees associated with the program are included in the monthly savings quoted to you by a debt consultant. Our fees usually range from 15% to 25%, but your rate may vary depending on your state of residency.

What is debt relief?

The type of debt relief Freedom Debt Relief offers is known by several names: debt resolution, debt negotiation, and debt settlement. Debt relief allows you to resolve your unsecured debt by negotiating with creditors and reducing the amount you owe. You could negotiate with your creditors on your own or use a debt relief program like Freedom Debt Relief to help you settle your debt.

During the debt relief process, you usually stop paying your creditors and start saving money in a special purpose account you will use to settle your debt. Once enough money is saved, either you or the debt relief company you hired contacts your creditors to negotiate a new debt amount that is lower than you currently owe.

How does Freedom Debt Relief work?

Freedom Debt Relief is the largest debt negotiator in the U.S. We offer our debt relief program to Americans with $7,500 or more in unsecured debt—including credit card debt, personal loan debt, and medical debt—who are experiencing a legitimate financial hardship.

The Freedom Debt Relief program is designed to resolve your debt for significantly less than you owe as quickly as possible. First, we provide a debt evaluation to help you decide if our program is right for you. If you decide that it is, we work with you to design a program that fits your monthly budget (keep in mind that it could be less than your monthly minimum payments). Once you enroll, our expert negotiators create a negotiation strategy designed to get you the results you want. Our company has used this method to resolve over $9 billion in debt since 2002. That’s much more than any other debt relief company in the industry.

What types of debt can you help me with?

Freedom Debt Relief could help you with debt from credit cards, medical bills, department store cards, and many other types of unsecured debt. Our program cannot help with a debt that involves collateral (like auto loans and mortgages). Also, we cannot resolve federal student loans. We do help with private student loans and some business debts on a case-by-case basis.

Are debt relief companies legitimate?

We approach everything we do with integrity, but sadly not all debt relief services have the same commitment to ethics we have. That’s why we encourage you to research every company you are considering before you commit to any debt relief program. As a founder of the American Fair Credit Council, Freedom Debt Relief has been involved in establishing industry standards that protect consumers from abusive debt settlement practices. We are a legitimate debt relief service that has helped tens of thousands of people resolve debt.

How do I choose a good debt relief company?

We recommend looking for debt relief programs that are transparent about the types of debt they accept, give a realistic timeline, and a realistic estimate of your potential savings. Additionally, debt relief companies are legally not allowed to charge fees until after a debt has been settled. We recommend you view the Federal Trade Commission’s advice.

Should I include all of my credit cards in the program?

If you have one card with a low balance that you can quickly pay down to zero, then you may hold on to it for emergencies. The program will generally not work, however, unless you enroll all of your high balance (greater than $500) credit card accounts. Open credit cards make it difficult for us to negotiate with your creditors if they see you are settling on some accounts but not others.

Who controls the account where my funds are held while I await settlement?

You do. The bank account is set up in your name, and the money in the account is yours. We recommend keeping your funds in a new account, separate from your existing bank accounts because experience has shown this separation to dramatically increase the probability that you will succeed in the program. Freedom Debt Relief fees are deducted from this account on a debt-by-debt basis and only after each debt is settled, as indicated in the agreement you signed with us. But you still own the accumulated savings in the account.

Will I owe taxes on my forgiven debt?

The IRS considers a forgiven debt as taxable income, so at the end of the year they will expect taxes to be paid on the settlement. IRS Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness, may exempt you from this tax. Please contact a tax adviser to discuss this issue further.

Do interest and late fees accrue on my accounts?

If you let your accounts become delinquent, your creditors will continue to add interest and late fees onto your balances. Typically, your balance will increase until a settlement is reached. Keep in mind that the interest is going to accrue regardless of whether you make minimum payments or not. Our goal is to negotiate substantial reductions to the balances on your accounts, even after the interest and late fees have accrued. When you work with Freedom Debt Relief, additional fees and interest that your creditor may charge is included in your estimate. Even if your creditor charges extra fees and interest, the fee we collect to settle the debt will not increase.

Can I negotiate on my own?

Yes you can. You can also do your own taxes and repair your own car, but most people would rather leave these tasks to experienced professionals. The Freedom Debt Relief team of negotiation specialists resolve over $288 million in debt each month. Our knowledge and experience puts us in a strong position to stand up to your creditors and fight for the best settlement possible.

Do you start negotiating with my creditors right away?

Negotiation activity is typically very limited until you have saved up enough in your settlement account to make reasonable offers to your creditors. Most (but not all) creditors do not want to spend time negotiating an account unless they know there are funds available. The first settlement typically happens between months four and six of a client’s program, but this varies greatly depending on your monthly deposit amount, the number of creditors you have enrolled in the program, and the balance of each individual account. In some instances, it may take more than six months before the first settlement is reached.

How do I qualify for legal representation?

To qualify for the Legal Partner Network service, you must have made all your program deposits on time and in the full amount. It’s important that there are enough funds available to negotiate a settlement if needed. Consistent deposits are crucial to overall program success and create negotiating leverage for attorneys to work on your behalf.

Get started now and see how much you can save!