What Is Credit Card Debt Relief?

Nov 04, 2025

It can be difficult to know where to turn for help with credit card debt. There are many options out there, but some are more helpful than others.

At a high level, credit card debt relief involves strategies to help you manage, reduce or eliminate your credit card debt through avenues like negotiation and consolidation. If you’re struggling with credit card debt, it’s important to understand your options.

Let’s explore debt relief, including when it may make sense, common options and how to avoid scams.

When to consider credit card debt relief

There are many reasons to consider debt relief, including:

High-interest debt: High interest rates on your credit card or other debt might make debt relief worth considering. If your current interest rates are causing your credit card debt to grow, debt relief may help you lower your interest rates.
Difficulty making the minimum monthly payments: If you’re having trouble making minimum payments on your credit cards, this can be a reason to consider debt relief. In some cases, you may be able to consolidate multiple monthly payments into one payment. If this payment is lower than your current payments combined, you may find it easier to pay down your debt without sacrificing too much of your monthly budget.
Loss of income: Financial hardship due to job loss is another situation in which debt relief might make sense. Losing your job often comes with significant financial uncertainty, and debt relief can help you regain control of your finances.

Credit card debt relief options

Credit card debt relief can take several forms. Here are a few of the most common options.

Personal loans for debt consolidation

You could use a personal loan to roll high-interest debt, like credit card debt, into 1 monthly payment. This may simplify your finances and, depending on the loan term and interest rate, could help you save money in the long run.

If you’re having trouble making existing debt payments, however, you may need to choose a longer term to help reduce your monthly payments. Just keep in mind that this may mean paying more interest in the long run. A personal loan calculator may help you understand the short- and long-term costs and choose a loan term that makes sense for you.

Credit card balance transfers

Transferring credit card balances to a card with a low intro APR on balance transfers can be a way to strategically pay down debt. If you can pay off all or much of your debt before the intro APR period ends (at which point any outstanding balances are charged the regular APR), a balance transfer card may make sense.

Keep in mind that you’re typically charged a balance transfer fee to access the low intro APR. The fee is typically either a percentage of the transferred balance or a flat fee.

Debt management plans (DMPs)

Credit counseling agencies are typically nonprofits that, in addition to offering financial education and counseling, can help clients get out of debt with a DMP. A DMP is a structured debt repayment plan for unsecured debts that a credit counseling agency negotiates. Ideally, this results in lower interest rates and fees.

On a DMP, you’ll typically make 1 payment per month to the credit counseling agency, which will make payments to your creditors on your behalf. These plans can take 48 months or longer to complete.

Bankruptcy

Bankruptcy is usually a last-resort option to pursue if your debts are overwhelming and other debt management strategies aren’t available to you. Bankruptcy involves seeking relief through the federal court system. Once you file, any debt collection actions must cease.

There are 2 common types of bankruptcy:

Chapter 7: Here, you liquidate your assets to pay creditors and discharge most of your debts. Certain assets may be exempt, depending on where you live.
Chapter 13: This requires you to create a repayment plan to pay off your debts over time. Typically, the repayment plan lasts 3 to 5 years.

Keep in mind that certain types of debt may not be eligible to be forgiven via bankruptcy, such as child support, alimony, fines and taxes. Bankruptcy can also significantly affect your creditworthiness, so it’s important to think carefully about your financial options and consult an attorney before considering it.

Is debt settlement a good idea?

Debt settlement is typically offered by for-profit companies. The company works with your creditors to negotiate your debt and, ideally, reduce what you owe so that you may pay a smaller lump sum to get out of credit card debt. These companies may encourage participants to stop making their monthly payments while they work behind the scenes.

However, there can be major drawbacks:

There’s no guarantee that these companies will get your creditors to agree to settlements
Creditors may start debt collection while you’re attempting to settle
You generally need to pay for these types of services

You may end up owing more money, especially if you stop making monthly credit card payments.

Beware of debt relief scams

Unfortunately, bad actors may try to prey on people with credit card debt by making false promises of debt relief and demanding exorbitant fees. Fraudulent debt relief agencies may even pose as government organizations or falsely use the names of real businesses, such as banks, to give their schemes the illusion of legitimacy.

The Federal Trade Commission (FTC) warns consumers to be cautious of debt relief scams. The major red flags the FTC identifies are:

Guarantees that your debt will be forgiven. Because it’s impossible to promise results, no legitimate debt relief agency will make these guarantees.
Requests for upfront fees before any services are provided. These fees are prohibited by law, so asking you for money is usually a clear sign that the agency is not legitimate.

Being aware of these warning signs can help you avoid falling victim to debt relief scams and make informed decisions about managing your debt.

Finding the debt relief option that’s right for you

If you’re finding it difficult to pay your debts, know that there may be options available. Your debt relief options can depend on many factors, including your total debt, monthly payments, interest rates and income. If you aren’t sure about the best option for you, talking to a qualified credit counselor may help.

Disclosure: This article is for educational purposes. It is not intended to provide legal, investment, or financial advice and is not a substitute for professional advice. It does not indicate the availability of any Citi product or service. For advice about your specific circumstances, you should consult a qualified professional.

Additional Resources

Insights and Tools >

Utilize these resources to help you assess your current finances & plan for the future.
FICO® Score >

Learn how FICO® Scores are determined, why they matter and more.
Glossary >

Review financial terms & definitions to help you better understand credit & finances.

Important Legal Disclosures & Information

Citibank.com provides information about and access to accounts and financial services provided by Citibank, N.A. and its affiliates in the United States and its territories. This is not, and should not be construed as, an offer, invitation, or solicitation to buy or sell any of the banking or financial products mentioned herein to individuals outside of the United States. The products and services mentioned herein are not offered to individual residents in Europe, including the European Union, European Economic Area, Switzerland, the United Kingdom, and similar countries.

Terms, conditions and fees for accounts, products, programs and services are subject to change. Not all accounts, products, and services as well as pricing described here are available in all jurisdictions or to all customers. Your eligibility for a particular product and service is subject to a final determination by Citibank and its affiliates. Your country of citizenship, domicile, or residence if other than the United States, may have laws rules, and regulations that govern or affect your application for and use of our accounts, products and services, including laws regarding taxes, exchange and/or capital controls that you are responsible for following.