Freedom Debt Relief: 2025 Review

Freedom Debt Relief covers unsecured debts (those not backed by collateral). Here's a list of the debts that this company may be able to help you with:

• Collections

• Credit cards

• Department store credit card

• Lines of credit

• Medical debt

• Personal loan debt

While Freedom Debt Relief may be able to help with payday loans, repossessions and private student loan debt, these involve a longer process that requires more verification than the other forms of debt listed.

Ineligible debts

Freedom Debt Relief can't help with unsecured debts (those that require collateral), as well as some other circumstances. Here are the debts that Freedom Debt Relief doesn't help with:

• Federal student loans

• Debt from lawsuits

• Some secured loans (HELOC, mortgage, auto)

• Some utility bills

• Tax debt

If you choose to work with Freedom Debt Relief, the company will guide you through a five-step process designed to help you reduce and manage your debt. Here's a rundown of the steps:

• Assessment: In this initial step, one of Freedom Debt Relief's debt consultants conducts a free financial assessment to determine your eligibility for the program. This step helps ensure the program is a good fit for your financial situation.

• Deposit: If you're eligible and decide to enroll, you’ll begin making monthly deposits into an FDIC-insured account that you control. You’ll also stop paying your creditors, as the negotiation process starts once you've saved enough in your account.

• Negotiation: During the negotiation phase, Freedom Debt Relief works to negotiate with creditors to lower your debt. The duration of this step depends on how many debts need to be settled and the timeline of negotiations with your creditors.

• Settlement: Once a settlement is reached and approved by you, payments are made to the creditor. Freedom Debt Relief also collects its fee at this point.

• Graduate: After all your debts have been settled, you officially "graduate" from the program. However, not all participants reach this step since debt settlements can't be guaranteed.

As mandated by federal law, Freedom Debt Relief does not charge upfront fees for its services. You won't be charged until the company completes your first debt settlement. Fees vary by state but generally are between 15 and 25 percent.

Freedom Debt Relief should outline all of its terms and fees for you before you sign up for the program. If you are considering enrollment, read through all the details so you know what you are getting into.

Of course, there are consequences for not paying Freedom Debt Relief's fees. You may face service cancellation, renewed collection efforts, possible legal action and additional harm to your credit score.

Credit score consequences

Working with a debt settlement company can harm your credit score — particularly if you've already missed payments. Debt settlement typically requires you to stop paying your creditors, which may result in your accounts being sent to collections. These collection accounts can remain on your credit report for up to seven years, further impacting your credit.

After a debt is settled, it will be marked as "settled" rather than "paid in full" on your credit report. Some lenders may view this as a red flag. However, completing a debt settlement program could gradually help your credit by lowering your credit utilization, which is an important factor in credit scoring.

Risks of debt settlement

Debt settlement, while appealing due to the possibility of having part of your debt forgiven, comes with significant risks. The process can take one to two years, and the settled debt will remain on your credit report for several years after completion. Additionally, creditors are not obligated to negotiate, meaning you might damage your credit without achieving any debt relief. 

You may also face consequences at tax time: The IRS may also consider the forgiven amount as taxable income, so you could face a tax bill on that forgiven debt. When factoring in the costs of the debt relief company, taxes and fees, you might end up paying more than you would have by paying off the debt in full.

Before choosing debt settlement, it's wise to explore alternative solutions, such as:

• Credit counseling: A certified credit counselor can help you build a budget, negotiate lower interest rates and create a repayment plan without harming your credit.

• Debt consolidation: This option merges multiple debts into a single loan, often with lower interest rates or easier payment terms. It simplifies debt management, but good credit is usually required to qualify for better terms.

• Debt management: Offered by credit counseling agencies, this structured plan consolidates unsecured debt into one payment. Credit counselors negotiate with creditors to reduce interest rates and fees, and unlike debt settlement, this approach doesn’t negatively impact your credit score.

You must meet specific requirements to qualify for Freedom Debt Relief’s debt settlement program. Below are the key qualifications and documentation needed.

Minimum debt amount

Freedom Debt Relief typically requires individuals to have a minimum of $7,500 in unsecured debt to enroll in its program. This includes debts such as credit cards, medical bills, personal loans and other unsecured loans. Secured debts, such as mortgages or auto loans, are not eligible for the program because they are backed by collateral.

Financial hardship

Applicants must demonstrate a legitimate financial hardship that prevents them from repaying their debts in full. This hardship can include job loss, medical emergencies, unexpected expenses or other personal financial setbacks that make it difficult to manage monthly debt payments. Freedom Debt Relief assesses whether your financial situation justifies participation in their debt settlement program.

Ability to make monthly deposits

While clients are not required to continue making payments to creditors, they must demonstrate the ability to make regular monthly deposits into a dedicated savings account. This account, which is FDIC-insured and under the client’s control, is where funds are accumulated for future debt settlements. Freedom Debt Relief requires individuals to save enough money to make lump-sum settlement offers to creditors over time.

Willingness to stop creditor payments

Clients must be willing to stop making payments to creditors during the settlement process. This is necessary because creditors are more likely to negotiate a settlement when they believe they may not recover the full amount owed. 

However, this can lead to late fees, interest and damage to your credit score, which is why you should know these consequences before enrolling.

Required documentation

To begin the program, applicants must provide certain documentation to verify their debts and financial situation. This may include:

• Proof of income (pay stubs, tax returns, etc.)

• A list of all unsecured debts

• Statements from creditors (credit card bills, loan statements, etc.)

• Information on any recent communications with creditors, especially those related to missed payments or collection efforts

These documents help Freedom Debt Relief assess your debt load, financial condition and whether you are a good fit for the program.

• BBB rating and accreditation: BBB Accredited with an A+ Rating

• BBB customer reviews: 4.47 out of 1,887 reviews

• ConsumerAffairs: 4.5 out of 33,262 reviews

• Google reviews: 4.7 of 505 reviews

• TrustPilot: 4.6 of 45,235 reviews

Review information is accurate as of January 30 2025.

Many clients praise Freedom Debt Relief for its helpful and empathetic customer service. Users often mention that the debt consultants are supportive, professional and good at explaining the process. 

However, some clients express frustration with the program's duration, noting that the settlement process can take longer than expected, often extending beyond two years. Additionally, some reviews criticize the fees involved, stating that the overall cost of the program is higher than anticipated. 

Accreditations

Freedom Debt Relief holds the following accreditations and certifications:

• Accredited by the Better Business Bureau (BBB)

• Accredited by the American Association for Debt Resolution (AADR)

• Certified by the International Association of Professional Debt Arbitrators (IAPDA)

Phone: 800-330-3446

Operating hours: 

• Monday through Friday: 8 a.m. to 11 p.m. EST

• Saturday and Sunday: 9 a.m. to 9 p.m. EST

Address: 1875 S. Grant St. #400, San Mateo, CA 94402

Fax: 650-332-1515

Email: info@freedomdebtrelief.com

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