This article provides a template for a debt settlement proposal letter and explains what a debt settlement letter should contain. Use this letter to help you negotiate a full and final settlement offer with your lender.Below, we've created an example of a debt settlement proposal letter that you can use as a guide. Your letter can be sent via your preferred contact method. Do I want the dispute to be decided in public? Ask for exactly what you want. A demand letter is an official notice requesting money, possession of assets, or action on a legal matter. The purpose of this form was to document and verify that loan proceeds were disbursed in accordance with the Authorization. Use this letter to help you negotiate a full and final settlement offer with a creditor. A debt validation letter is a written communication that a consumer sends to a debt collector or creditor to request verification and validation of a debt.