This article provides a template for a debt settlement proposal letter and explains what a debt settlement letter should contain. 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. Send this letter as soon as you can -- if at all possible, within 30 days of when a debt collector contacts you the first time about a debt. Our debt settlement agreement template helps to clearly outline repayment terms to reach a mutually agreeable solution. Use this letter to help you negotiate a full and final settlement offer with a creditor. An overview of how to respond to debt collectors and your rights when dealing with them. If you're worried about how to get out of debt, here are some things to know — and how to find legitimate help. Collectors can't harass you. This is a type of offer where you ask the creditor to accept part of the amount you owe and write off the rest.