National Debt Relief Review (2024)

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If you're struggling to make payments toward your unsecured debts, a debt settlement company like National Debt Relief can help. The company boasts an average savings of 25% (after fees) for clients who complete a settlement program, and has extensive positive reviews online. However, the debt settlement process has several potential pitfalls, and there may be other solutions better suited to your needs.

National Debt Relief Overview

National Debt Relief is among the largest and most highly-rated debt relief services in the country; it has also made our list of the best debt settlement services. By negotiating with creditors, National Debt Relief helps borrowers experiencing financial hardship settle outstanding debt. The company handles most forms of unsecured debt, and claims to have helped more than 600,000 people get out of debt since it began operating in 2009.

National Debt Relief is accredited by the American Fair Credit Council and the Better Business Bureau, where it has an A+ rating. The company also has a customer rating of 4.7 out of five stars on Trustpilot, where only 5% of over 37,000 reviews rate the company three stars or lower. Among negative reviews, common complaints include a lack of results, a lengthy settlement process, and unexpectedly high fees.

Based in New York City, National Debt Relief offers debt relief services to consumers in 46 states and Washington D.C. Due to state regulations, residents of Connecticut, Oregon, Vermont and West Virginia are ineligible.

How National Debt Relief Works

Like other debt settlement services, National Debt Relief works by renegotiating or otherwise altering the terms of your debt in order to facilitate repayment. The company works with a wide variety of unsecured debts, including credit cards, personal loans, medical bills, collections and repossessions, private student loan debt, and more. Secured debt like a home mortgage or auto loan is typically ineligible for settlement along with overdue taxes and federal student loans.

The debt settlement program begins with a free consultation, during which a specialist will assess the amount and eligibility of your debt, and your ability to make payments based on your income and budget. The specialist will then present options tailored to your financial circ*mstances.

If you choose to enroll in a debt settlement program, you'll stop paying off the accounts you want settled, and instead begin making payments to an FDIC-insured escrow account under your control. That single monthly payment is often less than what you would be expected to pay toward your accounts otherwise. When you have a sufficient balance in escrow and are several months behind on your accounts, National Debt Relief will begin negotiating with creditors to settle your debt for a reduced amount or with other more favorable terms.

There's no guarantee your debt will be settled, but National Debt Relief claims an average negotiation rate of 50%, which means the average settlement reduces the total debt enrolled by half (not including fees). When a settlement is reached, National Debt Relief will present the offer for your approval. Once approved, you'll release funds from escrow to pay the settled amount either in a lump sum or over time. This process repeats for each debt you want settled, and completing a settlement program in its entirety typically takes 24-48 months.

One negative aspect of debt settlement is that your credit score may decline when you stop making payments to creditors and your accounts become delinquent. You may also be subject to litigation by creditors — while such cases are scarce, you shouldn't ignore the possibility.

How Much Does National Debt Relief Cost?

National Debt Relief offers a free consultation before you enroll in a debt relief program. You have no obligation to pursue any of the options presented during the consultation, and there is no sign-up fee for enrolling in a debt settlement program.

In accordance with FTC regulations, National Debt Relief does not collect any payment until at least one of your debts has been settled, reduced, or otherwise altered, and there's no cancellation fee for backing out prior to that point. In the event that no settlement is reached, you won't pay anything. Once you approve a resolution agreement and your debt is settled, you'll pay an average fee of 15-25% of the total debt enrolled (as opposed to the settled amount). Rather than pay the settlement fee up front, it may be factored into the monthly payments you make toward your remaining debt.

Using the average negotiation rate (50%) and fee (20%) as an example, $20,000 of enrolled debt could be reduced to $10,000 after settlement and incur a fee of $4,000, yielding a remaining balance of $14,000. The enrolled debt is effectively reduced by 30% in that case. However, your results may vary.

In addition to settlement fees, any forgiven debt may be counted as taxable income. Whether that results in an a greater tax liability depends on your financial circ*mstances. Consult a tax professional for guidance on how a debt settlement may impact your return.

How National Debt Relief Compares to the Competition

National Debt Relief is comparable to other top debt settlement companies in many respects. While the company does not currently advertise a minimum debt requirement, it has previously stated an eligibility threshold of $7,500, and anecdotal evidence shows that most clients enroll more than $10,000 of debt. That's roughly in line with what you'll find elsewhere in the industry.

National Debt Relief offers a "satisfaction guarantee," but the policy does nothing more than adhere to the federal regulations mentioned above, which apply to all debt settlement companies. Once a debt is settled, the guarantee no longer applies regardless of whether you're satisfied with the outcome. That said, each debt is handled separately, and settling one debt does not create an obligation to settle additional debts.

One area where National Debt Relief comes up short is the limited availability of its customer service. Support for existing clients is offered exclusively by phone Monday through Friday from 10 a.m. to 8 p.m. EST — support for new customers is also available on weekends. There is no email or online chat support in either case.

National Debt Relief Frequently Asked Questions