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. Forms and applications for general courts, protection orders and garnishment. Not sure about how to counter your creditor's debt settlement offer? Download this free Debt Settlement Offer Letter sample. Reputable credit counselors can advise you on managing your money and debts, help you develop a budget, and offer free educational materials and workshops. I am now experiencing financial hardship due reduced income. Use this letter to help you negotiate a full and final settlement offer with a creditor. A debt settlement letter is all you need to negotiate debts with your creditors.