What Is Freedom Debt Relief?
Freedom Debt Relief (FDR) was co-founded in 2002 by Bradford Stroh and Andrew Housser and is headquartered in San Mateo, California. According to Bills.com, it is the oldest and largest debt settlement provider in the country, having resolved over $20 billion in debt for more than 1 million clients since inception.
FDR holds an A+ rating from the Better Business Bureau and is a founding member of the American Association for Debt Resolution (AADR, formerly AFCC). The company operates in 31 states directly and 10 more through legal partnerships.
Freedom Debt Relief at a Glance
| Minimum debt | $7,500 in unsecured debt |
| Fees | 15%–25% of enrolled debt — only charged after settlement |
| Program length | 24–48 months (avg. 39 months) |
| Clients served | 1M+ clients, $20B+ resolved |
| Avg enrolled debt | $28,000 across 7 accounts (NerdWallet) |
| BBB Rating | A+ accredited since 2015 |
| Trustpilot | 4.5/5, 48,000+ reviews |
| Additional fees | $9.95 escrow setup + $9.95/month service fee |
How Freedom Debt Relief Works
The process is similar to other debt settlement companies, per BadCredit.org:
- Free consultation — A specialist reviews your debt and hardship situation. Soft credit pull only — won’t hurt your score.
- Stop paying creditors — You stop direct payments to enrolled creditors, which creates negotiating leverage.
- Build your dedicated account — Deposit a fixed monthly amount into an FDIC-insured account instead.
- Freedom negotiates — Negotiators reach out to creditors with settlement offers, often using FDR’s scale to access dedicated resolution desks.
- You approve every settlement — Nothing is paid until you sign off.
- Fee charged on settlement — 15–25% of enrolled debt, collected as each account settles.
Pros and Cons
- Largest, oldest debt settlement company (since 2002)
- BBB A+ rating, AADR founding member
- $20B+ resolved for 1M+ clients — strong creditor leverage
- Fee-refund guarantee if costs exceed savings
- Includes attorney network for legal challenges at no extra cost
- Only soft credit pull to start
- 2019 CFPB enforcement action ($25M settlement)
- Not available in 9 states + DC directly
- $9.95 setup + $9.95/month extra fees on top of settlement fee
- Credit score drop of 50–100+ points in first 6–12 months
- Settled debt may be taxable — IRS Form 1099-C
- No federal student loan help
Freedom Debt Relief vs National Debt Relief
Per NerdWallet, both companies share the same $7,500 minimum and up to 25% fee — the differences are in scale and reach:
| Factor | Freedom Debt Relief | National Debt Relief |
|---|---|---|
| Founded | 2002 | 2009 |
| Debt resolved | $20B+ | $11.5B+ |
| State availability | 41 states | 46 states + DC |
| Avg savings after fees | Higher (per NerdWallet) | ~20% (NerdWallet estimate) |
Our Verdict
Freedom Debt Relief earns a strong runner-up spot. Its scale — $20B+ resolved over 23 years — gives it creditor leverage few competitors can match, and the fee-refund guarantee is a meaningful protection. The 2019 CFPB action and extra escrow fees are worth knowing, but the company has since operated under strict compliance and maintains a BBB A+ rating with broadly positive reviews.
Soft credit check only · No upfront fees · Takes 2 minutes
FAQ
Is Freedom Debt Relief legit?
Yes. Per Bills.com and The Penny Hoarder, Freedom Debt Relief is a legitimate, BBB A+ rated company that has resolved over $20 billion in debt for 1 million+ clients since 2002.
What was the 2019 CFPB action about?
The CFPB took enforcement action in 2019 related to fee disclosure and communication practices, resolved through a $25 million settlement. The company has operated under strict FTC compliance since.
How long does the program take?
Per The Penny Hoarder, programs typically run 24–48 months, averaging 39 months depending on debt amount and creditor response.
Will it hurt my credit?
Yes. Stopping payments causes accounts to be marked delinquent, with a typical 50–100+ point drop in the first 6–12 months per industry estimates. See CFPB guidance on credit reporting.
What states is Freedom Debt Relief not available in?
As of 2026, Freedom operates directly in 31 states and through legal partnerships in 10 more, per CNBC Select. Check availability for your state during the free consultation.
Sources: Bills.com · NerdWallet · CNBC Select · BBB · Trustpilot · The Penny Hoarder · CFPB
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