Sample Settlement of Debt Letter

The most important feature of a letter proposing settlement of debts is the benefit provide to a creditor. In most cases, this means changing a creditor's expectations from "payment in full" to a somewhat lower recovery which is far more likely to produce a greater net recovery than instigating collection procedures. See? Convince a creditor that a one bird in hand is better than misplaced hope for the future.

Tips for writing a successful letter

For the most part, the people who will read your settlement proposal letter will be somewhat jaded. They hear excuses daily. They pay no attention to pleas for mercy. In a very real sense, they are desensitized to claims of hardship and lack of financial ability. Unchanged sample letters almost never work if not personalized. Nevertheless, a well written and personal letter will still be persuasive if following a few common sense guidelines:

• be professional.
• ask, don't demand debt reductions.
• use correct language and grammar.
• change sample letters.
• state your debt settlement proposal clearly.
• support your debt proposal with verifiable documentation.
• be brief, and to the point.

Always keep a copy of your letters for your records. Also, if a formal dispute arises later, be certain that your letter (representative of your demeanor and tone of voice) will be admissible evidence.