A debt settlement letter is all you need to negotiate debts with your creditors. It asks you to pay a certain settlement amount to the collection agency.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. 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. If you want to negotiate a credit card debt settlement yourself, these templates can help you handle the debt negotiation in the best way possible. Credit card debt settlement is one of the fastest ways out of debt without filing for bankruptcy. Learn how you can settle your debt. Make it clear to the creditor that you intend to pay the debt. •.