Below, we've created an example of a debt settlement proposal letter that you can use as a guide. Your letter can be sent via your preferred contact method.This article provides a template for a debt settlement proposal letter and explains what a debt settlement letter should contain. Use this template letter to make an initial debt settlement offer if the debt is still with the original creditor. I am now experiencing financial hardship due reduced income. Get the facts about a debt settlement program so you can make an informed decision about whether it's the right way to solve your problems with debt. Debt Settlement is when a lender or creditor agrees to accept less than the full amount of debt owed and consider the debt paid off. This article will make the process of responding to a debt lawsuit a little bit easier and tell you how to answer a summons for debt collection in Florida. Not sure about how to counter your creditor's debt settlement offer? Download this free Debt Settlement Offer Letter sample.