How do I Write a Debt Settlement Offer?

Felicia Dye
Felicia Dye
Man with hands on his hips
Man with hands on his hips

When writing a debt settlement offer, you need to provide the creditor with sufficient information to access your account. Specify the reason that you cannot pay the full outstanding balance and offer to pay a specific amount. Indicate how much of the balance is added cost, such as fees and interest. Write using language that communicates a sincerity to settle the matter and include a letter of agreement to be signed by the creditor.

A debt settlement offer is essentially a letter offering a creditor to enter into a contract. Considering this, it is important to make sure that you provide information at the beginning of the letter to identify yourself. Include your address, contact details, and account reference. This information can be essential because the creditor may have numerous clients with the same name as yours and may need this other information to be able to access your account for review.

Increase your chances of having the debt settlement offer accepted by providing a reason for wanting to pay less than the current balance. If you are having financial difficulties, you should include this information. Inciting fear about your ability to pay in the future can motivate creditors to accept your offer now. Whatever your reasons, do not write your letter in a tone that sounds demanding or deserving. Instead, you want to appear as if you are sincerely trying to settle your debts to the best of your ability.

Include the outstanding balance and the amount that you want to pay. While you may want to suggest that there is some opportunity for negotiation, you want to avoid leaving the decision of how much should be paid entirely up to the creditor. It can also be helpful to outline the portions of the outstanding balance that resulted from fees, interest, and penalties.

Make sure the debt settlement offer specifies what you want. Do not assume that the creditor can figure this out. If, for example, you want the creditor to adjust information filed in your credit report, you need ask that he do so. If he agrees to your offer and you do not include all of your conditions, you will be held liable for the payment but will not have grounds to force the creditor act as you wish.

Include a letter of agreement with your debt settlement offer. The letter of agreement should outline your obligations and the creditor’s obligations as specified in your settlement offer. This document should be signed by you and the creditor. Signed copies should then be exchanged.

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      Man with hands on his hips