How To Choose the Right Debt Settlement Company

Once you have decided that debt settlement is the best debt relief strategy for your personal situation, how do you decide which debt settlement company to work with? The practice of debt settlement has been given a bad name as a result of companies that have failed in negotiations after making great promises, leaving the client in a worse financial position.

Debt settlement is a risky business and you must carry out thorough research before entrusting anyone with your finances. Before agreeing to employ the services of a debt settlement company, there is a list of things you need to check for before committing to any binding agreement.

AFCC Accreditation

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It is a good idea to check whether the company you are considering is accredited with the American Fair Credit Council, an industry watchdog that ensures consumers are treated fairly when it comes to debt relief. This accreditation reduces the risk to the consumer, as member companies are evaluated independently by the AFCC for performance capabilities, competence and fair practices. Other accreditations you can look for include that of The Association of Settlement Companies or the United States Organizations for Bankruptcy Alternatives.


The representative should be able to give you an estimate of what debt settlement will cost you and be honest about their fees and the risks involved should negotiations with the creditors not go as planned. The last thing you want to do is to end up even deeper in debt.

A great red flag is if the company charges any fees upfront. All debt settlement companies have to comply with the Federal Trade Commission rule that states that fees may only be collected after negotiations are completed.


Check if the company offers more than just debt settlement. A company that has the consumer’s best interest at heart should also offer other debt relief solutions, as debt settlement is not the ideal solution in every situation. Other services would include credit counseling, debt restructuring and debt consolidation.

External Reviews

Don’t be fooled by glowing testimonials on the website of the debt settlement company you are considering. Check their rating on reputable consumer review websites such as Top Consumer Reviews or Top Ten Reviews. In 2014, the top ranking debt settlement program on both sites is, according to researchable information,┬á

BBB Rating

Check with the Better Business Bureau to see whether the company in question is a member and what their rating is. Ratings are influenced by reports from actual consumers who have used the company’s services recently or currently using the services of the company.

Debt Negotiators

Does the company you are considering have debt negotiators that are IAPDA certified? This certification means that the debt negotiator who will represent you not only has a solid understanding of your current financial situation but is also up to date on industry news.

Chamber of Commerce

Check whether the company belongs to your local chamber of commerce and whether the chamber is also accredited with the Chamber of Commerce of the United States. This accreditation will indicate that the company is conducting business properly when it comes to how it treats its clients.