12 Low Income Debt Relief Programs

Debt is one of the most stressful and universal challenges that people face—especially when you’re living on a low income. Whether you’re struggling with medical bills, student loans, credit card debt, or facing a lawsuit, finding real help can feel overwhelming.

The good news? There are legitimate resources out there that can reduce your payments, stop collection calls, and even forgive some debts completely.

Of course, most financial assistance programs focus on basic needs—like rent, food, and medical care—not your long-term financial stability. Many charities won’t cover past-due credit cards or auto loans. On top of that, there’s stigma around debt, and a lot of worry about “enabling” bad financial habits.

But that doesn’t mean help isn’t out there—you just need to know where to look.

Start By Talking to a Nonprofit Credit Counselor

The first and most helpful step is to speak with a nonprofit credit counseling service. These services are free or low-cost. They can help you:

• Review your budget
• Correct mistakes on your credit report
• Lower your interest rates
• Stop debt collectors from calling
• Combine your debts into one monthly payment
• Possibly lower the amount you owe

These services are different than for-profit debt companies, which often charge high fees and may not act in your best interest.

One trusted place to start is Care Connect USA. They can connect you with a nonprofit counselor who has been screened for quality and safety. Call them at 866-530-9949.

Medical Debt Relief

Medical bills are one of the most common types of debt in the United States. Here are several ways to get help:

1. Nonprofit hospitals must offer free or reduced-cost care to low-income patients. Ask the hospital billing office for a financial assistance application. You may qualify even if your income is up to 400% of the federal poverty level.
2. Medicaid can sometimes pay for past care. This is called “retroactive coverage.” It used to go back 90 days, but now it only covers the last 30 days. If you are eligible, apply as soon as possible.
3. If your medical debt is less than $500, the three main credit reporting agencies (Experian, Equifax, and TransUnion) have stopped including those on credit reports.
4. Care Connect USA also offers a medical debt relief line. They can help you negotiate your bills or reduce your balance. Call them at 866-530-9949.
5. Groups like RIP Medical Debt may forgive your medical debt by buying it in bulk, but there is no way to apply. If they buy your debt, you will be notified by mail.

Student Loan Debt Relief

Big changes are coming to student loan repayment plans. Starting in July 2028, all current income-based repayment plans (like PAYE, REPAYE, IBR, and ICR) will be replaced with one new plan.

If you are totally and permanently disabled, you might qualify for a TPD discharge to have your student loans completely forgiven.

For help, call our sponsor CareConnect USA’s Student Aid Relief Line at 888-201-0431.

Tax Debt Relief

If you owe back taxes, the IRS has several programs that can help:

• Installment plans let you pay over time
• Offer in compromise may let you settle for less than you owe
• The Fresh Start Program is a general relief program that may apply to your situation

These options are useful but not very common for people with low incomes, since most low-income people receive tax refunds instead.

Win Up to $4,700 to Help with Debt (July 2025 Only)

Our sponsor Solo is offering a giveaway to help people tackle debt-related challenges:

• 3 people per week will win $500
• One person will win $4,700 in cash on August 1, 2025
• You can enter once per day until July 31, 2025

To enter, visit the SoloSuit Giveaway Page and submit your entry. This is a fantastic opportunity to lighten your debt load, so don’t miss out!

Other Debt Relief

Many lenders have hardship programs. These may reduce your payments, delay them, or lower your interest. When you call, you need to specifically, “Do you offer any hardship or forbearance programs?”

Take notes about who you talk to and what they say. Ask for all promises in writing before you send any money. Some lenders have promised to help but then went back on their word, so it is important to protect yourself.

Even if no one can pay off your debt, many programs can help with other bills. This can free up money so you can pay off debt on your own. Look for help with:

• Rent or mortgage payments
• Utility bills
• Groceries
• Health care
• Childcare

For more information, explore the other articles and videos on our site. We regularly post about grants, housing help, and more.

If You’re Being Sued for Debts (or Facing Bankruptcy)…

Getting served with a lawsuit can be terrifying, but you do have options.

• Solo helps generate and file legal responses to debt lawsuits.
• Always file an answer to avoid default judgments.
• Upsolve helps low-income people file Chapter 7 bankruptcy for free.
• You can also call the Free Bankruptcy Advice Line at 888-204-7732..

Relief Recap

If you’re overwhelmed by debt, don’t give up—there are real options available. Nonprofit credit counselors can lower your payments and stop collections. Hospitals and Medicaid can help with medical bills. Student loans are shifting to a more manageable system, and legal tools are available to defend yourself in court. The right support can help you get back on your feet.