This article provides a template for a debt settlement proposal letter and explains what a debt settlement letter should contain. Your debt settlement proposal letter must be formal and clearly state your intentions and what you expect from your creditors.A debt settlement letter is a written proposal for you to offer a specific amount of money in exchange for the forgiveness of your debt. Fill in your contact details, account number and any extra information you want to include in the grey shaded areas. 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. What should I include in a debt settlement letter? To dispute a debt, you must write a letter to the debt-collection agency within 30 days of their initial contact with you. 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. What information should be included in my paidinfull letter?