Understanding the Different Types of Debt Settlement Letter

Man at desk with billsDebt settlement is for you if you are suffering financial hardships, which cause you to fall back on payments and start receiving those never-ending creditor calls. A positive alternative to bankruptcy, debt settlement enables you to negotiate your debt, reducing your balance and eventually eliminating it for good.

When it comes to debt settlement, not one size fits all. Financial Solutions of America understands that communicating effectively with creditors  is of the utmost importance. We will examine the various types of debt settlement letter below.

Debt Settlement Agreement Letter

If you’re establishing a settlement with a creditor or collection agency, it’s paramount to have that agreement in writing. The debt settlement agreement letter states the terms and conditions between you and your creditor, and any other debt settlement letter you have on file from the creditor should be attached to this agreement when mailing it.

Counter Offer for Debt Settlement

You don’t always have to settle for what the collection agency offers. When your personal debt is concerned, it’s up to you to make the correct decision, and sometimes that includes a little negotiating. A counter offer is your own proposed payment, a response to the offer made in the debt settlement agreement letter.

Writing a counter offer is a useful tactic when trying to resolve your debt. You have the right to explain your situation, along with the amount that you can pay to fully settle the debt. Collection agencies would much rather see you take the initiative to work with them, rather than just ignoring their calls. In many circumstances, they will be willing to take your offer (or negotiate on a similar offer) and settle with you for good.

Letter of Acceptance of Verbal Offer

Plastic payment cardsOnce you have established a settlement amount, it’s important to confirm the offer (with the necessary signatures) in writing. This important debt settlement letter confirms the agreement between you and your creditor or collection agency, and it’s especially important if the agreement didn’t take place in person. Even if you received verbal confirmation over the phone, be sure to get everything in writing for your records.

Unsolicited Offer Letter

This type of debt settlement letter allows you to take control, establishing the first written communication regarding your debt. In an unsolicited offer letter, you propose what you’re willing to pay before receiving anything from the creditor or collection agency. Rather than waiting for harassing phone calls or letters, you are showing initiative in terms of both the payment amount and the schedule. Let your creditor know that you’re serious about your offer, explain your financial situation honestly, and only propose an amount and payment schedule that is realistic for you. The effort to take control of your debt is what will impress the collection agencies and give you the chance for a better settlement, one that will work for you.

calculator pen and receiptsPay for Delete Settlement Letter

This type of letter is for when you’ve come to a settlement and the creditor or collection agency agrees to erase the account information from your credit report. That information doesn’t need to be seen now that it’s been settled, but you’ll need a pay for delete settlement letter to have this agreement in writing.