National Debt Relief claims it can help you settle your debts for 25-46% less than what you owe. But is it the right solution for your financial situation?
The Bottom Line Up Front
National Debt Relief has assisted over 550,000 customers in resolving more than $10 billion of unsecured debt since its 2009 founding. Clients who successfully complete the program typically reduce their debt by 46% before fees, or around 25% after accounting for the company’s charges. However, debt settlement comes with serious risks, including credit score damage, tax implications, and no guarantee of success.
How National Debt Relief Works
The process is straightforward but requires commitment:
- Free Consultation – You’ll discuss your debts with a certified specialist to determine if you qualify
- Dedicated Savings Account – Instead of paying creditors, you deposit money monthly into an FDIC-insured account
- Negotiation Phase – National Debt Relief negotiates with your creditors while your account builds up
- Settlement – Once creditors agree to a reduced amount, you approve the settlement and funds are released
Your first settlement may occur within three to six months, though completing the entire program typically requires 24 to 48 months.
What It Costs
National Debt Relief uses a performance-based fee structure:
- Fee Range: 15-25% of your enrolled debt amount
- Minimum Debt Required: $7,500 in most states
- When You Pay: Only after a settlement is reached and you approve it
- No Upfront Fees: You don’t pay anything until results are delivered
Example: If you enroll $50,000 in debt and National Debt Relief negotiates it down to $25,000, you’d pay up to $12,500 in fees (25% of the original $50,000). Your total payment would be $37,500 instead of $50,000, saving you $12,500.
Eligible Debts
What Qualifies:
- Credit card balances
- Personal loans and lines of credit
- Medical bills
- Collections accounts
- Business debts
- Private student loans (limited cases)
- Repossession deficiency balances
What Doesn’t Qualify:
- Mortgages
- Auto loans
- Federal student loans
- Back taxes
- Child support
- Current cell phone contracts
The Real Risks You Need to Know
Credit Score Impact: Your credit score will drop during the process because you stop paying creditors. Each missed payment appears on your credit report, progressively lowering your score.
Tax Consequences: The IRS may treat forgiven debt as taxable income, potentially creating a tax bill. There’s an insolvency exemption, but consult a tax professional before enrolling.
No Guarantees: Creditors aren’t required to negotiate. You could damage your credit without achieving any debt reduction.
Collection Actions: While negotiating, creditors may pursue aggressive collection tactics, including lawsuits.
Top Debt Relief Alternatives to Consider
| Option | Best For | Pros | Cons |
| Credit Counseling | Those with steady income | Lower fees, less credit damage | Requires regular payments |
| Debt Consolidation Loan | Good credit scores | Lower interest, one payment | Need decent credit to qualify |
| Balance Transfer Card | Credit card debt under $15K | 0% intro APR periods | Must pay off during intro period |
| Bankruptcy | Severe financial hardship | Legal protection, fresh start | Major credit impact, 7-10 years on report |
Is National Debt Relief Legitimate?
National Debt Relief maintains an A+ rating with the Better Business Bureau and has been accredited since 2013. The company holds certifications from the International Association of Professional Debt Arbitrators and is an accredited member of the American Association for Debt Resolution.
Customer reviews average 4.7 stars on Trustpilot from over 42,000 reviews. Positive reviews praise successful settlements and responsive customer service. Negative reviews cite credit damage and fees.
Who Qualifies?
To enroll with National Debt Relief, you must have:
- At least $7,500 in unsecured debt ($10,000 in some sources)
- Demonstrated financial hardship (job loss, medical emergency, divorce)
- Ability to make monthly deposits into your settlement account
- Several months of missed payments (not just one or two)
The company operates in most states but is unavailable in Oregon, Vermont, West Virginia, and Wisconsin.
Frequently Asked Questions
How long does debt settlement take?
Most clients complete the program in 24-48 months, though your first settlement may occur within 3-6 months.
Will I owe taxes on settled debt?
Possibly. The IRS may consider forgiven debt as taxable income, though insolvency exemptions exist. Consult a tax professional.
What happens to my credit score?
Your score will likely drop significantly because you stop paying creditors during negotiations. The “settled” status also impacts your credit report for years.
Can creditors still sue me during the process?
Yes. Debt settlement doesn’t provide legal protection from collection actions or lawsuits.
Do I have to settle all my debts?
No. You can choose which settlement offers to accept. You only pay fees on debts that are successfully settled and that you approve.
What if National Debt Relief can’t settle my debt?
You don’t pay fees if settlements aren’t reached. However, you’ll still face the consequences of missed payments, including credit damage and accumulated interest.
Should You Use National Debt Relief?
National Debt Relief works best for people who:
- Owe $10,000+ in unsecured debt
- Are already several months behind on payments
- Face legitimate financial hardship
- Have explored alternatives like credit counseling
- Understand and accept the credit consequences
Before enrolling, meet with a nonprofit credit counselor. Credit counseling services are free or low-cost and can help you create a budget, review your credit report, and develop a debt management plan. A debt management plan offers similar benefits without encouraging you to stop payments.
Ready to Explore Your Options?
If you’re struggling with overwhelming debt, take these steps:
- Get a free consultation with National Debt Relief to understand your potential savings
- Speak with a credit counselor to compare all debt relief options
- Review your budget to see if debt snowball or avalanche strategies could work
- Compare costs between debt settlement, consolidation loans, and other solutions
Get Your Free Debt Relief Consultation – National Debt Relief offers no-obligation consultations to assess your situation. Call 800-300-9550 or visit their website to learn if debt settlement could save you thousands while helping you become debt-free in 2-4 years.
Remember: Debt settlement should be a last resort before bankruptcy. Explore all alternatives first, and never work with any company that charges upfront fees or makes unrealistic promises.
In another related article, Citizens Debt Relief Review: Can This Company Really Cut Your Debt in Half?
