Types of Debt Relief

Each path works differently. Start here to understand options—then compare companies that offer the type that may fit you.

Placeholder type summaries. Confirm with client which types to include and any required disclosures.

Debt consolidation

Combine multiple balances into one payment—often through a loan or consolidation program. May lower interest if you qualify for a better rate.

Debt settlement

Negotiate to pay less than the full balance owed. Can reduce principal, but may affect credit and have tax implications. Fees and timelines vary.

Credit counseling

Work with a counselor to build a budget and explore nonprofit repayment guidance. Often a first step before a formal debt management plan.

Debt management plans (DMPs)

Structured repayment through a counseling agency, often with reduced interest from participating creditors. You typically repay in full over time.

Personal loans

Borrow to pay off higher-interest debt. Outcomes depend on credit, rates, fees, and repayment discipline. Rate shopping may involve soft or hard credit checks.

Bankruptcy

A legal process that can discharge or reorganize certain debts. Serious long-term credit consequences apply. Consult a qualified attorney for advice.

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