How to Find Nonprofit Debt Relief

If you’re struggling with debt, you may be looking at options for debt relief. If you’re finding it hard to keep up with debt payments and want to work with a trusted company, then look no further than a nonprofit credit counseling agency.

We’ll go over exactly what debt relief is, what the advantages are to working with a nonprofit for debt relief, and what to look for when figuring out the best nonprofit credit counseling agency to work with.

What Is Debt Relief?

The term “debt relief” can be confusing as it’s often used to cover very different approaches to helping consumers get out of debt, explains Gerri Detweiler, education director for Nav, which helps small business owners build strong business credit for free.

“If you think about it, even bankruptcy can be a form of debt relief,” says Detweiler. “But when consumers think about debt relief, however, they are usually looking for a way to pay back their debt on more affordable terms.”

Of course, you want to repay the money they borrow, but you may find yourself in a situation where the payments and or interest rates are too high and you can’t afford to continue.

What are Common Forms of Debt Relief?

Debt Consolidation

Debt consolidation is the solution many people automatically think of when they are having trouble making payments, points out Detweiler. When you consolidate your debt, you might transfer your credit card balances to a single credit card, ideally with a zero percent introductory APR. Or you might consolidate your debt by way of a loan.

The thing with debt consolidation is that you’ll need strong credit to qualify for the best terms and rates. “Usually, they’re looking for a consolidated monthly payment at a lower cost, but if you have a lot of debt, in particular high credit card balances, your credit scores have probably taken a hit,” says Detweiler. “That makes it more difficult to qualify for financing at the lowest interest rate.”

Credit Counseling

Another way you can obtain debt relief is by connecting with a trusted, reputable credit counseling agency. The credit counseling agency may be able to help you get on a debt management plan (DMP) where you make one or two payments a month, often at reduced interest rates, explains Detweiler. “Although the debt isn’t technically consolidated because you still owe each individual creditor, the effect is similar: You’re juggling fewer monthly payments and you have a clear debt-free date.”

Filing Bankruptcy

While not ideal, filing bankruptcy is technically a form of debt relief. There are two main types of consumer bankruptcy you can file: Chapter 7 and Chapter 13.

Chapter 7 bankruptcy allows a consumer to be released from credit card debt, explains Elaine Harrison, AFC®FFC® and Financial Coach. Chapter 7 is usually for those with limited income. Your possessions will be sold to help repay your debts.

Chapter 13 is also known as reorganization bankruptcy. By way of a court order, you receive a repayment plan that normally lasts anywhere from three to five years.

What Are the Benefits of Working with a Nonprofit Debt Relief Company?

The advantages of working with a non-profit credit counseling company are many, and include:

Guidance on budgeting and debt

Accredited credit counselors provide unbiased advice and financial education. If nothing else, they’ll be able to provide you with a fresh perspective on your finances, explains Detweiler. This service is usually free or low cost. Many nonprofits also have financial wellness workshops and other resources to help you get out of debt.

Debt management plans

A nonprofit credit counseling agency can help you understand whether you qualify for a debt management plan to pay off your credit card balances, says Detweiler. “If you qualify, interest rates may be reduced and you’ll make one or two monthly payments to the counseling agency which will then pay your individual creditors.”

Plus, having a plan can help you avoid the temptation of making minimum payments on your credit card, which can keep down debt for decades.

Holistic support

Some agencies can provide specialized help with student loans, delinquent mortgages, and more. If your financial challenges extended beyond just credit card debt, it’s a great first stop.

They want to see you succeed

Nonprofit agencies have no underlying profit motive when assisting you, explains Harrison. “They provide expert advice and to help consumers find ways to better manage their incomes and expenses. Plus, they offer their services free of charge or at a minimal cost.”

Nonprofit credit agencies tend to attract people who want to help others, adds Beverly Harzog, credit card expert and consumer finance analyst for U.S. News & World Report. “They’re consumer-oriented for the person, and they are usually a lot less expensive than working with a for-profit company.” Plus, they are better trained to help you emotionally. “As emotions and finances are very much tied together, they’re better equipped to work with your emotions, too,” she says.

How Can I Find a Nonprofit Credit Counseling Agency?

You can find a list of accredited non-profit agencies through the National Federation of Credit Counselors (NFCC). Founded in 1951, the NFCC is the oldest and largest nonprofit financial counseling organization. Member agencies need to be accredited and adhere to high standards specific to the debt management and credit counseling industry.

What Should I Look for When Shopping for Nonprofit Debt Relief?

Some questions you should ask yourself when looking for a non-profit credit counseling agency to work with include:

What are the fees?

While nonprofit credit counseling agencies are less expensive than for-profit ones, you’ll want to make sure you know what the fees are. That way you can figure out if you can afford the payments. As we mentioned, some debt management plans may even be free or available at a discount depending on your circumstances.

Understand what kind of debt relief they’re promising

Learn what kind of debt relief services are being offered, and whether it’s the right fit for you, says Detweiler. “Some companies may really be offering debt settlement, which means you stop paying your bills and later try to negotiate lower lump sum payoffs,” she explains. While that may be appropriate in some situations, it’s not always clear what you’re getting in to. When in doubt, ask as many questions as you can.

Look at their track record

Ultimately, you want to work with a company that has a solid reputation and track record, says Detweiler. “You are counting on them to take the payments that you make to the counseling agency and then pay your creditors, and you want to make sure that always gets done on time as it should be.” Scour online reviews on sites such as Trustpilot and the Better Business Bureau.

Working with a nonprofit credit counseling agency is a great way to help you achieve debt relief. If you have questions, reach out to an accredited counselor today to learn more.

Jackie Lam is an L.A.-based personal finance writer who is passionate about helping creatives with their finances. Her work has appeared in Forbes, Mental Floss, Business Insider, and GOOD, as well as on She blogs at

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