What are debt settlement/debt relief services?

Debt settlement companies and debt relief companies are companies that say they can renegotiate, settle, or in some way change the terms of a person’s debt to a creditor or debt collector. That includes reducing the balance, interest rates or fees a person owes. You can try to do this yourself by contacting your creditors. Debt settlement and debt relief companies often charge expensive fees.


Avoid doing business with any company that promises to settle your debt if the company:

  • Charges any fees before it settles your debts
  • Touts a "new government program" to bail out personal credit card debt
  • Guarantees it can make your debt go away
  • Tells you to stop communicating with your creditors
  • Tells you it can stop all debt collection calls and lawsuits
  • Guarantees that your unsecured debts can be paid off
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