This article provides a template for a debt settlement proposal letter and explains what a debt settlement letter should contain. 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 will make the process of responding to a debt lawsuit a little bit easier and tell you how to answer a summons for debt collection in Texas. Here is a quick template for those looking to send a settlement offer to a collection agency or Pay for Delete. Not sure about how to counter your creditor's debt settlement offer? Download this free Debt Settlement Offer Letter sample. Request to begin debt settlement negotiations. If the collection agency or creditor rejects your offer, don't lose hope. A debt settlement letter is a tool to negotiate with your creditors and settle your debt at a lump sum payment you're comfortable making.