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Do Free Debt Consolidation Programs Exist?

Do Free Debt Consolidation Programs Exist?

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Mark Cappel
UpdatedJul 9, 2024
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    5 min read
Key Takeaways:
  • There is no such thing as a free debt consolidation program.
  • Learn how you can consolidate debt on your own, at the lowest cost.
  • Examine the different free resources available to help you improve your finances.

Free Resources and Information to Help You Save Money

We all like getting things for free, including free debt consolidation programs. Realistically, there is no such thing as a free lunch. The kinds of free options that are available are ones that you have to do for yourself. There are no free debt consolidation programs offered by professionals, but there are many of positive financial steps you can take at little or no cost.

  • Do-it-Yourself Debt Consolidation
  • Free Debt Advice
  • Free Professional Debt Consultations
  • Free Debt Help Resources

Do-it-Yourself Debt Consolidation

There are a few ways you can consolidate or pay off debt with little or no costs. If not exactly free, these are the cheapest ways to consolidate debt on your own:

  • Balance Transfer: You can use a balance transfer to consolidate high-interest debts on a 0% or low-interest credit card. There is almost always a percentage fee for the transfer, but you can save a lot of money if you are able to aggressively pay down the balance during the time your low-interest balance transfer rate is in effect.
  • 401(k) Loan: Borrowing money from your retirement account to pay off high interest debt is the very close to a free debt consolidation program. You pay interest on the loan, but the interest goes back into your own account. Never miss a loan payment or you could be subject to income tax and a 10% tax penalty. You can also face penalties if you lose or leave your job during the loan period and can't repay the balance in full.
  • Insurance Policy Loan: Some types of life insurance policies build up a cash value. If you have that kind of life insurance, you can borrow against the cash value you've accrued, typically at very low costs. Interest rates and fees vary, so make sure that it makes sense to borrow from your policy.

Free Advice

There is a lot of free debt consolidation advice available. Free advice is available online, in books, magazines, and on TV. The basic free advice focuses on solutions that you can put into place on your own. A lot of it is "common sense," and does not vary much regardless of the source:

  • Make a Budget: A sensible financial plan relies on you monitoring your income, spending, debts, and assets. Use the budget guide as a starting point.
  • Cut Expenses: Any solution to a debt problem is only a band-aid, if you repeat the same behavior that got you into debt before. Take every step you can to controlling your spending and use the money you save to build financial security.
  • Pay Your Debts Effectively: Make a plan of action to pay off your debt. Don't get stuck in a cycle of making only minimum payments. Target either your lowest balance card or your highest interest card and, after it is paid off, take the money you were paying towards it and put it towards paying off another debt.
  • Earn More Income: This is easier said than done. The demands of a job, life, and family, along with a tough employment market, make it hard to find a second job. However, it is clear that using to additional income to pay off debt will help you become debt free faster.
Quick Tip

Receive a no-cost, no-hassle debt relief quote from one of’s pre-screened debt relief providers.

Free Professional Debt Consultations

While the following professional debt consolidation services are not free, you can receive a free consultation from any of them. A free consultation will give you more information to understand your financial situation and your available options.

  • Credit Counseling: Consumer Credit Counseling Services should offer you a free initial consultation that includes an in-depth financial review. If you're working with a quality CCCS, you'll receive free advice on budgeting, spending, and money management.
  • Debt Settlement: A reputable debt settlement firm will also offer you a free initial consultation. You'll receive a free financial assessment, learn about your debt consolidation options, and find the right plan for your circumstances and budget.
  • Bankruptcy: Bankruptcy attorneys offer free consultations, too, to anyone who is considering this option of last resort." You can find out if you have a strong enough hardship to discharge your debts in a chapter 7 bankruptcy, if a chapter 13 repayment plan is the best solution, or if the attorney advises against filing bankruptcy.

Free Resources

There are many different free resources you can turn regarding debt consolidation, including resources provided by the government.

  • Federal Trade Commission (FTC): The FTC provides a lot of solid information about debt consolidation and a wide variety of financial issues, including credit reports, and credit repair.
  • You can use as a free resource to learn about debt consolidation, how it works, and how to choose the right debt consolidation for your individual situation. offers you:
    • Articles: Read articles about every aspect of debt consolidation, including the pros and cons of each debt consolidation option.
    • Questions and Answers: You can read questions submitted by readers, answers from experts, or Ask Bill a question of your own.
    • Debt Coach: Debt Coach is a free tool that looks at your individual situation and recommends a specific solution. You can choose to have your debts pulled from your credit report, without it affecting your credit score, so the most accurate numbers are used for your analysis.
    • Money Coach: For a personal touch, call in and speak with a Money Coach. You'll receive a free, detailed, and confidential consultation that analyzes your income, spending habits, assets, and goals,and then presents you with a detailed plan of action.

Get rid of your debt faster with debt relief

Get rid of your debt faster with debt relief

Take the first step towards a debt-free life with personalized debt reduction strategies.

Choose your debt amount

Get started now

Or speak to a debt consultant  844-731-0836

Dealing with debt

If you are struggling with debt, you are not alone. According to the NY Federal Reserve total household debt as of Quarter Q1 2024 was $17.69 trillion. Student loan debt was $1.60 trillion and credit card debt was $1.12 trillion.

According to data gathered by from a sample of credit reports, about 26% of people in the US have some kind of debt in collections. The median debt in collections is $1,739. Student loans and auto loans are common types of debt. Of people holding student debt, approximately 10% had student loans in collections. The national Auto/Retail debt delinquency rate was 4%.

The amount of debt and debt in collections vary by state. For example, in Wyoming, 24% have any kind of debt in collections and the median debt in collections is $2680. Medical debt is common and 17% have that in collections. The median medical debt in collections is $1515.

To maintain an excellent credit score it is vital to make timely payments. However, there are many circumstances that lead to late payments or debt in collections. The good news is that there are a lot of ways to deal with debt including debt consolidation and debt relief solutions.