Debt Settlement Proposal

A Debt Settlement Proposal is an offer made by a debtor to a creditor or debt collector to pay a portion of an outstanding debt in exchange for the forgiveness or discharge of the remaining balance. The proposal typically includes details about the amount of the settlement payment, the payment method and timing, and any conditions or requirements for the creditor to accept the offer. The proposal may also include a statement of the debtor’s financial hardship or inability to pay the full amount of the debt. The purpose of a Debt Settlement Proposal is to negotiate a mutually agreeable resolution to the debt that allows the debtor to avoid further collection efforts or legal action, while providing the creditor with a partial recovery of the debt. The proposal may be subject to negotiation and counteroffer by the creditor.