Freedom Debt Relief Review [2024]: Can They Actually Help You?

If you feel like you can’t make any financial progress, you’re not alone. Americans carried a collective $4.9 trillion (yes, trillion) in non-housing debt as of the second quarter of 2024, according to Federal Reserve data. Although there are strategies you can use to pay off debt on your own, there’s no shame in asking for help if you’re in over your head and missing monthly payments.

Before resorting to bankruptcy, consider getting help from Freedom Debt Relief. This company assists people in negotiating their debt balances with creditors, which could help you become debt-free much faster than you could do on your own.

Freedom Debt Relief at a glance

Minimum debt	$7,500 (typical debt is $25,000)
Types of debt	Credit card debt Medical bills Personal loan debt Department store credit debt Certain types of private student loan debt
Program length	24-48 months
Fees	15%-25% of your enrolled debt amount
Accreditation	AADR, IAPDA
Best for...	People with hefty debt balances who want to avoid bankruptcy
	Visit Freedom Debt Relief

How Freedom Debt Relief works

The Freedom Debt Relief program focuses mainly on debt settlement, but you can get information about alternatives such as debt consolidation.

The following types of debt qualify for debt settlement through Freedom Debt Relief:

• Credit card debt
• Medical debt
• Personal loan debt
• Department store credit debt
• Certain types of private student loan debt

If you’re unsure about the difference between secured and unsecured debt, the gist is that secured debt requires collateral. Freedom Debt Relief can’t help you with secured debt, such as your mortgage or auto loan.

If you decide to work with Freedom Debt Relief, here’s what you can expect:

Start with a free debt consultation

You’ll first talk with a representative about your debt and the state of your finances. Freedom Debt Relief will help you determine the best way to deal with your debt based on the amount you owe, interest rates, income, and other factors.

While people likely come to Freedom Debt Relief mainly for debt settlement, you should also hear about options such as a debt consolidation loan or credit counseling. I’d recommend thinking of debt settlement as an option only if your other main alternative appears to be bankruptcy.

If you decide that debt settlement with Freedom Debt Relief is best, you’ll work with the company to come up with a payment plan that fits your budget.

Make monthly deposits

Once you’ve enrolled, you will need to stop making payments to your creditors. Instead, you’ll make a monthly deposit into an FDIC-insured savings account. When you’ve been in default long enough to save sufficient funds in that dedicated account, Freedom Debt Relief will negotiate your first settlement with your creditors.

You control this account, but of course you should not withdraw funds from it except in extreme emergencies, because you’ll delay your debt payoff progress.

Account fees: There is a $9.95 fee to set up your account as well as a $9.95 monthly “account servicing” fee which goes to Crossroads Financial Technologies. This is in addition to the 15%-25% of the enrolled debt that you’ll pay Freedom Debt Relief, so factor that into your total cost for debt settlement.

Approve your settlement offers

The hope is that your creditors will agree to let you pay less than you owe and consider your account closed. If Freedom Debt Relief succeeds in negotiating with creditors, that’s how you can settle your debt much faster than by simply paying it off.

You’ll receive notice from Freedom Debt Relief of any settlement offers, and you can approve or decline. For example, a credit card company might offer to settle an $8,000 debt for $4,000. If you accept, Freedom Debt Relief will transfer the agreed-upon amount from your dedicated account to that creditor. (I wouldn’t settle an $8,000 debt for $7,000, however, because that doesn’t save you much and you’ll probably pay more in fees than you save.)

Paying fees to Freedom Debt Relief

Freedom Debt Relief charges 15% to 25% of your enrolled debt amount, depending on the state in which you live. The company does not collect this fee until you authorize a settlement and the first payment is made to the creditor. This is not uncommon, and this rate is typical for debt settlement companies.

This could still be less expensive than bankruptcy, which can cost $2,000 or more. And bankruptcy will also tank your credit, so it's typically viewed as a last resort.

Freedom Debt Relief also offers a guarantee that if your total settlement program cost exceeds the amount of debt enrolled, it will refund the difference up to 100% of its fees. I do like that feature, as it’s an additional safeguard against losing money on a settlement.

4.5

FinanceBuzz writers and editors score products and companies on a number of objective features as well as our expert editorial assessment. Our partners do not influence our ratings.

Get Rid of $25,000 in Credit Card Debt

You could resolve your credit card debt in as little as 24-28 months.¹

Get a free consultation

What we like about Freedom Debt Relief

• No upfront costs: Debt settlement companies aren’t allowed to charge upfront fees. You won’t pay a cent until Freedom Debt Relief finishes negotiating your debt settlement.
• Track your progress with the Client Dashboard: As a Freedom Debt Relief customer, you can easily view the progress of your debt settlement in your online account. You’ll also be able to access educational content to help you stay out of debt and improve your financial future.
• Excellent customer service: You can reach a certified debt consultant or customer service representative any day of the week by phone or email. Furthermore, Freedom Debt Relief has excellent customer reviews on the Better Business Bureau.

What Freedom Debt Relief could improve

• No guarantees: Freedom Debt Relief doesn’t offer a money-back guarantee, nor does it promise to forgive a certain percentage of your debt. Each settlement is a negotiation, and the results can vary.
• High fees. Freedom Debt Relief takes 15% to 25% of your enrolled debt amount as a settlement fee. This fee is expensive, but not uncommon in this industry. Plus, the account servicer charges $9.95 a month as long as you’re building up your fund for settling debts.

What Freedom Debt Relief customers are saying

More than 1,900 customer reviewers rated Freedom Debt Relief an average of 4.48 out of 5 stars through the Better Business Bureau. Freedom Debt Relief also has a 4.6 out of 5-star rating with Trustpilot and a 4.5 out of 5 with Consumer Affairs.

Many customers cited the ease of the process. One customer mentioned that Freedom Debt Relief helped her handle civil cases brought against her. And many reviewers said the customer service is friendly and helpful.

Additionally, a survey of Freedom Debt Relief program graduates that was published in 2019 offers some insight. Those who completed the FDR program reported 21% lower perceived stress than those who did not enroll. Plus, 87% said they were confident in their ability to handle an emergency expense, and 71% said they were following a budget or a financial plan.

Alternatives to debt settlement

Before you sign anything with Freedom Debt Relief, you want to be sure debt settlement is the way to go. Debt settlement aims to get you out of debt by paying less than the amount you owe, which harms your credit in the short-term, though settlement is still preferable to bankruptcy.

Credit counseling

One course of action to try before or instead of debt settlement is credit counseling. This involves working one-on-one with a certified consumer credit counselor to help you learn how to manage your money.

Credit counselors can offer free or low-cost advice on how to create a budget, how to pay off debt, monitoring your credit, and more. I recommend this option if your debt might be manageable and you just need a little help getting organized and improving your overall financial health.

Debt consolidation

Another alternative to settlement is a debt consolidation loan. Essentially, you combine two or more unsecured debts into a new loan with a single fixed monthly payment.

With debt consolidation, you still pay the full amount you owe, but you may get a lower interest rate or altered loan terms to save money. This can be a smart option if you have good credit and are committed to making loan payments on time. However, if your credit isn’t good, consolidation might not save you money at all because you likely won’t get approved for a loan.

Alternatives to Freedom Debt Relief

If you decide to pursue debt settlement, these companies offer the same services as Freedom Debt Relief.

National Debt Relief

National Debt Relief also provides a free consultation like Freedom Debt Relief and boasts similar customer satisfaction ratings of 4.7 out of 5 stars on Trustpilot. If you choose to pursue debt settlement, the company works to negotiate with your creditors to bring down your balance or adjust your interest. The fees are 15%-25%, and you only pay once the settlement is complete.

National Debt Relief is more widely available — currently, it operates in 47 states, while Freedom Debt Relief is only offered in 42 states. If you reside in a state that doesn’t have Freedom Debt Relief, check if National Debt Relief is an option.

Accredited Debt Relief

If unsure about Freedom Debt Relief, you can look into Accredited Debt Relief, however, they do charge the same 15% to 25% fees. This is also a debt settlement company with high customer ratings. Trustpilot users give it an average of 4.9 out of 5 stars. However, it may not be as widely available as Freedom Debt Relief or National Debt Relief (it’s unclear from the website in which states Accredited Debt Relief operates).

Legal action: One key factor that may make a big difference to you is that Freedom Debt Relief, unlike both of these alternatives, faced a lawsuit from the Consumer Financial Protection Bureau (CFPB). The suit alleged issues about misleading customers and charging them unfairly, and in 2019, Freedom Debt Relief settled to the tune of $20 million in restitution to customers, plus $5 million as a civil money penalty.

While this could indicate that Freedom Debt Relief is now operating in a more aboveboard manner, it might also make you more wary of the company. I could definitely view this past lawsuit as a mark against Freedom Debt Relief, since these other two companies haven’t faced the same legal woes.

FAQs

Bottom line

Generally speaking, if you're experiencing financial hardship and struggling to get out of debt, you should consider the debt settlement process only if other strategies won’t work for you. Before you decide to work with a debt settlement company, you might try these other debt solutions:

• Working with a nonprofit credit counseling agency on a debt management plan
• Negotiating with creditors on your own
• Applying for one of these balance transfer cards to reduce your interest rate
• Using a personal loan to consolidate your debt
• Trying a debt-repayment strategy
• Using a debt-repayment app

If the amount is too high or these options prove ineffective, debt settlement can sometimes be a better option than bankruptcy, though it depends on your financial situation. You should calculate the cost of both choices, along with the effort required, when making your decision.

If you do decide to go the route of debt negotiation, we think Freedom Debt Relief is one of the safest debt relief companies around, evidenced by thousands of happy customers.

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4.5

FinanceBuzz writers and editors score products and companies on a number of objective features as well as our expert editorial assessment. Our partners do not influence our ratings.

May help reduce debt balances and/or interest

Can help you pay off debt within two to four years

Will refund if your debt relief program costs more than your enrolled debt