This article provides a template for a debt settlement proposal letter and explains what a debt settlement letter should contain. To fill out this letter, clearly write your name and address at the top.Include the date and the collection agency's name and address. Here is a quick template for those looking to send a settlement offer to a collection agency or Pay for Delete. The court has placed the most commonly used forms on line as a resource. Please be advised that the forms detailed below are intended to be a guide. 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. I am writing in regards to the above-referenced debt to inform you that I am disputing this debt.