Debt Reduction Services Review: Is Credit Counseling Right for You?

If you’re buried in debt and struggling to make payments, credit counseling firms provide a way out without lasting damage to your credit. Debt Reduction Services is an established nonprofit credit counseling company that might be able to help!

Debt Reduction Services: What You Need to Know

Debt Reduction Services is based in Boise, Idaho, but is licensed to offer services in all 50 states. The company was founded in 1996 and has been in business for 26 years.

The company offers several options.

  • Free credit counseling and budgeting education
  • Debt management plans 
  • Student loan counseling
  • Bankruptcy counseling
  • Payday loan relief

Debt Reduction Services does not provide debt settlement services. If you decide on a debt management plan, you will still pay your debts in full, but your counselor will negotiate improved terms. Your debts will be consolidated into a single monthly payment.

You may be required to close some credit card accounts, which could temporarily harm your credit, but if you stick to the plan your credit score should improve.

Debt management plans are designed to help you resolve credit card debt, medical debt, payday loans, personal loans, and other forms of unsecured debt. Debt management plans cannot help you with secured debts like mortgages, car loans, home equity loans or HELOCs, or pawn shop loans. They also don’t include most student loans. If loans of this type are causing your problems, this might not be the solution for you.

Debt Reduction Services can provide student loan counseling to help you build a strategy to pay off your student loans. They can also provide the counseling sessions required for bankruptcy filing.

Debt Reduction Services is a member of the Financial Counseling Association of America (FCAA)

Debt Reduction Services at a Glance 

Do they offer a free consultation?Yes
How to get startedContact them by phone or online for a free counseling session that will clarify your situation and present options.
Fees*Debt Management Plans: not disclosed
Credit Report Review: $49
Student Loan Counseling: $99
Bankruptcy Counseling: $50/course
How it worksYou’ll start with a free evaluation and counseling session. Your counselor may recommend other services.
Who owns Debt Reduction ServicesJoseph Cestaro, President
Company address and phone number6213 N Cloverdale Rd Ste 100, Boise, ID 83713-4912(877) 688-3328, (208) 378-0200
BBB ratingAccredited, A+, 4.33/5
Trustpilot ratingN/A (only 1 review)
Minimum debt settledNot cited
Noteworthy featuresProvides free counseling and paid debt management plans, student loan counseling, bankruptcy counseling, and credit report evaluations.
*Some fees may be reduced or waived for low-income households.

What makes Debt Reduction Services Stand Out

Debt Reduction Services provides a typical range of services for a credit counseling company.

Credit Counseling

Debt Reduction Services provides free credit counseling and budgeting sessions. These sessions provide an excellent opportunity to discuss your finances with a professional counselor and clarify your options. 

To make the most of a credit counseling session, you should be prepared to provide complete information on your income, living expenses, and debts.

Debt Management Plans

If you’re carrying large amounts of unsecured debt, like credit card debt, medical debt, payday loans, and personal loans, your counselor may recommend a debt management plan. 

If you adopt a debt management plan, you will make a single monthly payment to Debt Reduction Services. They will pay your creditors and negotiate with your creditors for better loan terms. You may be required to close some credit cards and refrain from taking on new debt.

A debt management plan requires discipline and patience – plans may take several years to complete – but they are a great way to stop collection calls and pay down debt while protecting your credit. 

You will pay a fee for a debt management plan, and Debt Reduction Services does not specify the amount.

The company website claims that their debt management plans can reduce the interest rates on your debts by up to 75% and your monthly debt payment by up to 50%

Student Loan Counseling

Student loan debt is the fastest-growing debt in the U.S.

If student loans are at the center of your debt problem, your counselor may recommend student loan counseling. Counseling sessions will analyze your student, examine your payment options, including repayment plans and other forms of assistance — including refinance options — and recommend a payment strategy.

Student loan counseling is provided through a Zoom or Skype meeting and costs $99 for a one-hour session. You must have your FSLA ID ready.

Credit Report Review

Debt Reduction Services offers a comprehensive credit report review. Counselors will review each account with you, identify potential errors, and develop an action plan to help you improve your credit.

This service costs $49, but the fee can be reduced or waived for low-income families. If you’re considering buying a house or car, improving your credit before applying can save you thousands of dollars.

READ MORE: Why did my credit score drop?

Bankruptcy Counseling

Everyone who files for Chapter 7 or Chapter 13 bankruptcy must complete a pre-bankruptcy credit counseling course and a post-bankruptcy debtor education course. Debt Reduction Services is licensed to provide these courses in all states except Alabama and North Carolina.

Each course costs $50.

READ MORE: 10 ways to reduce bankruptcy costs

How to Sign Up

You can start the process by calling (866) 688-3328 or by completing the contact form on the company website. All programs begin with a free credit counseling session.

You will need to provide the following information.

  • Your income
  • Your monthly living expenses
  • A complete list of your debts, with the interest rate, monthly payment, and loan term for each

Be sure the information you provide is accurate and complete: if it isn’t, the counselor will not be able to help you effectively.

How Does Debt Reduction Services Work?

It’s essential to understand what this company does. If you’re looking for a way out of a severe debt problem, you’ll encounter two types of companies.

  • Credit counseling services are nonprofit companies. They work through counseling and debt management plans. The emphasis is on resolving your debt without destroying your credit. You will still pay your debts. They charge a flat fee.
  • Debt settlement companies are for-profit companies. They negotiate to settle debts for less than you owe. There will be severe damage to your credit score. They charge a percentage of the debt they settle. 

Debt Reduction Services is a nonprofit credit counseling service.

READ MORE: Got $50,000 in debt? Here’s how to pay it off fast

Is Debt Reduction Services a Scam?

Debt Reduction Services is an established company that’s been serving indebted individuals for 26 years. Customer reviews are generally good and they are a member of the FCAA, the leading trade association for non-profit credit counseling firms.

We can find no record of any legal or regulatory action against Debt Reduction Services.

Pros and Cons


  • Free credit counseling and budget analysis
  • Debt management plans can reduce debt without significant damage to your credit score
  • Client dashboard allows easy monitoring of your case
  • The impact on your credit score should be positive
  • Extensive track record


  • Debt management plan fees aren’t disclosed
  • No mobile app
  • Debt management plans don’t help with secured debts

READ MORE: What are the pros and cons of debt settlement?

Who Should Use Debt Reduction Services

Credit counseling services can assist almost anyone with a debt problem, but they are designed for people with serious debt issues. Ask yourself these questions.

  • Is your debt overwhelming?
  • Are you struggling to keep up with your monthly payments? 
  • Are you trying to avoid filing for bankruptcy? 
  • Are you trying to avoid managing your debts on your own?

If you answered “yes” to one or more of those, it may be time to consult a credit counseling service. 

Remember that a debt management plan is not a magic trick. Your debts will still be there, they’ll just be better organized and with better terms.

READ MORE: How to get out of credit card debt without ruining your credit

Who Should Not Use Debt Reduction Services

Almost anyone concerned about their debts can benefit from a free credit counseling session. There’s no commitment, and you’ll gain a new perspective on your situation. There are still some groups who are less likely to benefit.

  • People who don’t want to pay for a debt management plan
  • People with a manageable amount of debt
  • People whose debt problems come primarily from secured loans
  • People who don’t care about their credit score and want to reduce debt fast

If you’re in the last group, you might be better off with a debt settlement company.

The Website

The website is professional, informative, and easy to navigate. The company and its services are clearly described and there’s a wealth of useful financial education material. 

If you want to contact the company, there’s a simple contact form with a clear description of what’s involved.

Our only real complaint about the site is that there’s no indication of the cost of debt management plans. We realize that the costs may vary with the complexity of an individual’s debts, but even a typical range would be useful.

Customer Service

Customers can reach Debt Reduction Services by phone or through their online customer portal. Customer reviews indicate that service is fast, accessible, and friendly.

READ MORE: A complete guide to debt relief programs

Is Debt Reduction Services Trustworthy?

Debt Reduction Services has operated for 26 years without reported data breaches or other data security issues. Any time you provide personal information to another party there is some risk, but in this case, the risk appears to be low.

What are Customers Saying?

Debt Reduction Services is accredited by the Better Business Bureau (BBB) and carries an A+ rating, indicating that they are highly responsive to complaints. Customer reviews give the company 4.33 of a possible five stars, but there are only 12 reviews.

Trustpilot offers only a single review, too small a sample to be useful.

Debt Reduction Services get 4.9 out of 5 stars from Google reviews. Reviews are overwhelmingly positive, with high praise for the company’s service, effectiveness, and overall customer experience.

Want to know more about credit counseling? Check out this video:

The Bottom Line

Debt Reduction Services is a reputable, experienced nonprofit credit counseling provider. They specialize in debt management plans, which are designed to provide debt relief to people who owe unsecured debts, like credit card debt, medical debt, payday loans, and personal loans.

They also provide student loan counseling, bankruptcy counseling, and free credit and budgeting counseling, which can be helpful to anyone who is experiencing debt problems.


Why Would Debt Reduction Services Hurt Your Credit Score?

If you start a debt management plan you may have to close credit card accounts. This will reduce your credit history and could push your credit utilization up. There may be a temporary hit to your credit score, but if you complete the plan your score should improve.

What Kind of Debts Can Debt Reduction Services Handle?

A debt management plan can cover all unsecured debts, like credit card debt, medical debt, payday loans, and personal loans. Secured debts, like a mortgage, car loan, or pawnshop loan, will not be covered. Most student loans will not be included, but Debt Reduction Services also provides student loan counseling.

How Does Debt Reduction Services Compare to Debt Settlement Companies?

Debt Reduction Services is a nonprofit credit counseling service. If you select a debt management plan, your debts will be consolidated and your counselor will negotiate better terms. You will still pay your debts and damage to your credit should be minimal.
Dept settlement companies are for-profit companies that negotiate to settle your debts for less than you owe. You will pay a percentage of the reduction. Your debts will be reduced, but your credit will be damaged and you may have to declare the debt reduction as income.

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