Debt Help Decision Worksheet
Comparing debt settlement, credit counseling, and credit repair can feel overwhelming. This worksheet lays out the key differences and gives you questions to help you think through what might make sense for your situation.
Finav is building an app that looks at your specific debts and helps you think through these options based on your actual numbers. This worksheet is a good starting point until then.
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Debt Help Decision Worksheet
Comparing Your Options
| Debt Settlement | Credit Counseling | Loan Consolidation | Credit Repair | |
|---|---|---|---|---|
| What it does | Negotiates with creditors to accept less than you owe | Creates a structured repayment plan, often with reduced interest rates | Combines multiple debts into a single loan with one monthly payment | Disputes errors or outdated items on your credit report |
| Best for | Significant unsecured debt you can't realistically repay in full | Multiple debts you can repay but need help organizing and lowering costs | Good credit and multiple high-interest debts you want to simplify | Inaccurate or outdated items on your credit report hurting your score |
| Typical cost | 15-25% of enrolled debt | Setup fee + small monthly fee; some nonprofits charge nothing | Origination fee (1-8%) + interest on the new loan | $50-$150/month; some charge per deletion |
| Credit impact | Often significant negative impact during the process | May appear as managed payments; generally less damaging than settlement | Hard inquiry at application; may improve score over time by lowering utilization | May improve score if legitimate errors are removed |
| Timeline | 2-4 years typically | 3-5 years for a debt management plan | 2-7 years depending on loan terms | 3-6 months for disputes; results vary |
| Watch for | Upfront fees before settlement, guarantees of specific results | Non-accredited agencies, high fees, pressure to sign quickly | Higher total cost if loan term is long, fees for secured loans, running up old cards again | Promises to remove accurate information, demands for upfront payment |
Questions to Ask Yourself
There's no single right answer. These questions are meant to help you think through your situation, not to push you toward one option.
Can I realistically pay back what I owe, even on a longer timeline?
Is my main issue the total amount I owe, or the number of payments I'm juggling?
Are there items on my credit report that I believe are inaccurate?
Am I being contacted by debt collectors? If so, do I know my rights?
Can I afford monthly payments right now, or am I falling behind?
Have I already tried managing this on my own? What made it difficult?
Am I looking for short-term relief or a longer-term plan?
Do I understand the potential tax implications of settled debt?
Questions to Ask a Settlement Company
Get these answers in writing before you sign anything.
What fees do you charge, exactly, and how are they calculated?
What happens if a creditor refuses to settle?
What happens if a creditor sues before there's enough saved?
Where is my settlement money held, and can I access it if I leave the program?
Which debts do you recommend I don't enroll, and why?
Questions to Ask a Credit Counseling Agency
Listen to how they answer, not just what they say. If it feels like sales pressure, trust that feeling.
What services do you offer besides a Debt Management Plan?
What are the total fees, monthly and upfront?
Will my accounts be closed, and can I keep one card for emergencies?
Which creditors do you work with most often?
What's the process if my income changes or I can't make a payment?
Are you accredited or affiliated with a recognized counseling network?
Where can I see your complaint process?
My Notes
Learn More
We've written in-depth guides on each of these options. Read at your own pace.
- Debt Settlement Companies: What They Do, What They Don't, and When to Be Careful
- Credit Counseling Companies: What They Actually Do
- An Intro to Credit Repair Companies: What They Do, What They Can't, and How to Decide
- Debt Consolidation Companies: What to Know Before You Apply
- How to Think About Debt Without Panic
This worksheet is from FINAV (finav.app). We're building an app that walks you through this with your real numbers. Join the waitlist at finav.app.
What if you could see this with your actual numbers?
Finav connects to your accounts and walks you through your debt options based on what you actually owe, not a generic worksheet.
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