DEBT SETTLEMENT LETTER
Important jurisdiction and legal advice warning
This fictional letter is a negotiation example, not an admission template or legal advice. It is written for a consumer in Manchester, England, dealing with an ordinary unsecured account. Debt collection, interest, limitation, affordability, insolvency, court procedure and requirements for a binding settlement vary by jurisdiction and by the type of creditor. The recipient should obtain independent advice before signing, paying, or relying on any promise. No settlement is binding unless the creditor accepts it in the required form and the agreed payment is made.
From
Leah Miriam Foster
28 Rowan Walk, Manchester M20 4QJ
Telephone: 0161 555 2846
Email: leah.foster@example.test
To
Northbridge Retail Finance Limited
Customer Resolutions Team
85 Portland Street, Manchester M1 3HP
Account reference: NR-4827169
Date: 9 February 2027
Subject: Proposal to settle account NR-4827169
Dear Customer Resolutions Team,
I write about the credit-card account opened in my name on 4 March 2022. Your statement dated 31 January 2027 shows a claimed balance of GBP 4,860.40, comprising GBP 4,515.20 principal, GBP 295.20 interest and GBP 50.00 in fees. I do not presently admit that every amount is due. Please provide a current statement, the agreement or account information on which you rely, a transaction history, and details of any assignment or collection authority.
Background and current circumstances
I made regular payments until I lost my job at Green Orchard Catering on 17 June 2026. I found part-time work at Vale Market on 10 October 2026, but my net monthly income is now approximately GBP 1,720 rather than GBP 2,540. My essential monthly expenses are GBP 1,545, including rent of GBP 890, council tax and utilities of GBP 244, food of GBP 250, transport of GBP 96 and prescribed medication of GBP 65. I have no savings, property or vehicle and I support my daughter, Amira Foster, aged nine. I have also obtained free budgeting advice from Manchester Debt Support on 2 February 2027.
My present surplus is approximately GBP 175 each month. I want to resolve this account responsibly, but a demand for the full balance would cause missed rent and essential bills. I have not transferred, concealed or sold assets to avoid this account.
Settlement proposal
Without admission of liability and subject to your written acceptance, I offer GBP 2,250 in full and final settlement of all sums claimed under account NR-4827169. My aunt, Nora Foster of 11 Hawthorn Close, Stockport SK2 6LA, has offered to provide that amount from her savings if the terms are confirmed in writing. The offer will remain open until 5.00 p.m. on 24 February 2027. Payment can be made within five working days after your acceptance by the method you specify.
Your acceptance should state that GBP 2,250 settles principal, interest, fees, collection charges and any other amount arising from this account; that no balance will be sold or assigned; that collection activity will stop after cleared funds; and that you will update credit-reference information accurately to show the account as settled where applicable. Please send a receipt and confirmation of the final account status.
If you cannot accept the lump sum, please consider an affordable alternative of GBP 175 on the first day of each month beginning 1 March 2027. I ask that interest and charges be frozen while those payments are made and that the arrangement be reviewed after six months. This alternative is not a waiver of my request for account documents.
Response and safeguards
Please communicate in writing to my address or email above and identify the person authorised to accept this proposal. Do not treat a payment made before written acceptance as acceptance of liability or as agreement to different terms. I reserve all rights concerning the amount, enforceability, limitation, data accuracy and conduct of collection. I will continue to pay any amount separately agreed in writing and will keep proof of every payment.
If you reject both proposals, please explain the reason, send the requested account records, and provide your complaints procedure. I remain willing to use an appropriate independent dispute-resolution service. This letter is not intended to restrict any right or remedy that cannot lawfully be waived.
Yours faithfully,
Leah Miriam Foster
Signature: ____________________ Date: 9 February 2027
Creditor acceptance
For Northbridge Retail Finance Limited, I confirm that the terms above are accepted, subject to cleared payment of GBP 2,250 by 3 March 2027. On receipt, the account will be treated as settled with no further balance claimed.
Authorised representative: Martin Ellison, Resolutions Manager
Signature: ____________________ Date: ____________________