This article explains what demand letters are, when they are useful, and how to write them. Below is a sample settlement letter from the paying agency to the OAG authorizing the settlement or judgment and amount of the claim.This article provides a template for a debt settlement proposal letter and explains what a debt settlement letter should contain. A settlement demand letter is designed to make the strongest case possible for why you deserve appropriate financial recovery. This is a nonbinding proposal of terms and conditions of settlement between the City of San Antonio. Resolve your lawsuit outside of court and avoid unnecessary fees and hassle. Send a settlement letter offering to settle the dispute on your terms. Use this letter to help you negotiate a full and final settlement offer with a creditor. The demand letter should be factual, concise, and devoid of emotional language. Stick to the facts and lay out your demand in clear terms.