National determines the monthly payment level, which is often lower than the total monthly payments on customers’ unsecured debts.

Ceasing payment to your creditors means you become delinquent on your accounts, accruing late fees and additional interest, and your credit score will tumble.

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National then negotiates with individual creditors on your behalf in an effort to get them to accept less than the amount you owe.

Because you’re no longer paying the creditor, it may view getting a reduced amount as better than risking no payment at all.

If they reach an agreement, you pay the creditor from your savings account, either a lump sum or with installment payments.

The first settlement typically happens within three to six months, according to Eckert.

National does not settle debt from lawsuits, IRS debt and back taxes, utility bills or federal student loans.

It can’t settle auto or home loans, or other types of secured debts (debts with collateral).

To do this, many or all of the products featured here are from our partners. The company says consumers who complete its debt settlement program reduce their enrolled debt by 30% after its fees, according to the company.

But Nerd Wallet cautions that debt settlement, whether through National Debt Relief or any of its competitors, is risky: How to qualify: National Debt Relief works with consumers who have at least ,500 and up to 0,000 in unsecured debt from credit cards, personal loans and lines of credit, medical bills, business debts and private student loan debts.

Timeframe: On average, the company says, customers who complete their debt settlement program with National do so within two to four years.