This article provides a template for a debt settlement proposal letter and explains what a debt settlement letter should contain. List your name, account information, the original creditor of the debt, and the debt collection agencies identifying information.Use this letter to help you negotiate a full and final settlement offer with a creditor. We've settled debts with most major lenders. Here are examples of the letters we have sent that have worked for our clients. Below, we've created an example of a debt settlement proposal letter that you can use as a guide. I am now experiencing financial hardship due reduced income. A pay for delete letter is a negotiation tool to have negative information removed from your credit report.