Debt settlement fees

Our fee is 20 to 29% of your enrolled debt, depending on your situation and how you enroll, charged only after a settlement is agreed and the first payment to the creditor is made. "Enrolled debt" means the balances of the accounts you put into the program, measured when you enroll.

The percentage is set for you individually, and it is written into your enrollment agreement before you sign. Our fee is deducted only as you authorize it in your signed enrollment agreement. You see the fee for each settlement in dollars before you approve it.

Where you fall in our 20 to 29% range depends on your situation and how you enroll. Your percentage is the same for every debt you enroll. The dollar figures on this page show both ends of the range, as illustrations, not a quote2.

The FTC Telemarketing Sales Rule, at 16 CFR 310.4(a)(5) (eCFR, opens in a new tab), bans debt settlement companies from charging fees in advance.

In plain English, a company can collect a fee for a debt only when all three of these are true. The FTC guide for businesses (FTC, opens in a new tab) sets out the same test.

The fee must also follow one of two formulas: a share of the total fee in proportion to the debt that settled, or a percentage of the amount you saved on it. The percentage cannot change from one debt to the next.

Take $20,000 of enrolled debt across 4 accounts. At our fee range of 20 to 29%, the whole fee is $4,000 to $5,800. It is not charged at once: each account carries its own share, and that share is charged only after the account settles and you make the first payment on it.

In this example, the smallest account (Personal loan) settles first. Its fee of $600 to $870 is 20 to 29% of its $3,000 balance, and nothing is charged on the other accounts until they settle too. At these settlements, settlements plus fees total $13,000 to $14,800, against $20,000 owed.

Across the whole range, with creditors settling for 45 to 60% of each balance and a fee of 20 to 29%, the settlements plus the fee come to $13,000 to $17,800. That is $2,200 to $7,000 less than the $20,000 owed, before account fees, interest, late fees and tax.

The settlement fee is the cost you hear about most, but it is not the only one. Count all of these before you decide whether settlement saves you money.

There are no cancellation fees. The money in your dedicated account belongs to you: you can withdraw it at any time, and leave the program, without a penalty from us. Under the federal rule (eCFR, opens in a new tab), you get the money in your dedicated account back within seven business days.

The only amounts that can be kept are fees already earned, meaning fees for settlements you approved and started paying before you left.

Settlements already reached stay in place, as long as you keep up the agreed payments to those creditors. Accounts that never settled are still yours to deal with, often with more interest and late fees added.

Ask these questions of every company you talk to, including us. A good answer is specific and comes in writing.

If you want your own numbers, see your estimate with the fee shown as its own line. The full program is explained in our debt settlement guide.