Propose a settlement to resolve outstanding debt. Generate a professional debt settlement letter instantly with AI. Free account includes 2 letters per month, no credit card required.
Fill the form first. Create a free account only when you generate, then your first 2 letters each month are free.
[Your Name] [Your Address] [City, State, ZIP] [Email] | [Phone] [Date] [Creditor / Collection Agency Name] [Address] Re: Settlement Offer — Account Number [Account Number] Dear Sir or Madam, I am writing regarding the above account, which shows an outstanding balance of [amount]. I want to resolve this debt, and I am proposing a settlement I can realistically pay. Due to [brief reason, e.g. a job loss in March followed by reduced income], I am unable to pay the full balance. After reviewing my finances, I can offer a lump-sum payment of [offer amount] — approximately [percentage]% of the balance — as full and final settlement of this account. If you accept, I ask that you confirm the following in writing before I make payment: 1. The payment of [offer amount] will be accepted as full and final settlement of account [account number]. 2. No further collection activity will be pursued on the remaining balance. 3. The account will be reported to the credit bureaus as [settled / paid in full], as agreed. Upon receiving your written confirmation, I will send payment of [offer amount] by [payment method] within [number] days. This offer remains open for 30 days from the date of this letter. I would prefer to resolve this directly and promptly. Please respond in writing to the address above. Sincerely, [Your Name]
A complete example letter — generate your own version with your details, tone, and language in 30 seconds.
Open the generator with debt settlement letter selected. Add your facts, choose a tone, and generate when you are ready.
A strong debt settlement letter follows a simple format: clear purpose, relevant facts, a specific request, and a clean closing.
State the purpose of the debt settlement letter and identify the recipient or organization.
Include the details that matter most: Your Name, Creditor/Collection Agency, Account Number, Total Amount Owed.
Explain what you want the reader to do, approve, correct, consider, or confirm.
End with a concise thank-you, availability for follow-up, and your name.
Enter the key information: Your Name, Creditor/Collection Agency, Account Number, Total Amount Owed, Settlement Offer, Proposed Terms.
Pick from 3 options: Professional, Diplomatic, Firm.
AI creates a unique, polished letter in under 30 seconds.
e.g., $X,XXX.XX
e.g., $X,XXX.XX
e.g., Lump sum payment within 30 days, payment plan...
e.g., Optional but powerful — in a few sentences, how did this happen and how has it affected you? Your own words are what make the letter sound like you wrote it, not AI.
Use CraftMyLetter's Debt Settlement Letter template. Enter your details (your name, creditor/collection agency, account number, total amount owed, settlement offer, proposed terms), choose a tone, and generate a professional letter in 30 seconds.
Yes, you can generate 2 free debt settlement letters per month with CraftMyLetter. No credit card required. Credit packs start at $4.99 for 10 letters.
Our Debt Settlement Letter template offers 3 tones: Professional, Diplomatic, Firm. Professional is the most common choice.