Your debt settlement proposal letter must be formal and clearly state your intentions and what you expect from your creditors. Our debt settlement agreement template helps to clearly outline repayment terms to reach a mutually agreeable solution.This article provides a template for a debt settlement proposal letter and explains what a debt settlement letter should contain. New York City residents can use this letter to dispute a debt, to verify a debt under NYC law, and to tell a collector to stop contacting them. Use this letter to help you negotiate a full and final settlement offer with a creditor. Download this free sample of the debt settlement agreement template and know how to confirm the verbal debt settlement agreement in writing. You may have a debt in joint names, or want to write to your creditors together because you have worked out a joint budget. 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. To fill out this letter, clearly write your name and address at the top.