A Better Letter - A Guide To Writing An Effective Debt Settlement Letter

By Author: J.J. Yong
Total Articles: 963
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Many amongst us are easily intimidated by having to do writing of any shape or form. Writing a debt settlement letter is no exception. Undoubtedly it is not a simple task, yet it is one that you can achieve with some help. Here is a step-by-step guide on how you can compose such a letter in a manner that accomplishes your goal of winning favor from your creditors:

Have all your facts on hand

It is not possible to write confidently nor persuasively without having all the necessary information you need already at your fingertips. Do your homework by independently considering what you owe (your outstanding debts) as compared to what you currently earn (income) and what you can afford to pay (repayment). Make sure you are clear about what you really owe versus any claims made by your creditors. Not everything that is demanded by them may be required or necessary on your part.

Decide what amount you can afford, and will pay

This should be based on your earlier evaluation of your current financial standing as outlined in the previous point. Once you have a definite figure, work towards actually setting ...
... aside the amount so you don't find yourself in a pickle when it comes the time to pay up.

Look up sample letters

There are plenty of resources, especially on the Internet, where you can view samples of debt settlement letters. It is advisable that you look through some of them, so you have a good idea how you should write one for yourself.

Know your creditors -

What is meant here is that you should be aware of what sort of policies or procedures are typical for the creditors to whom you owe money. This will be an advantage to you when considering what is the best way to approach them and to make your requests not only heard but also acceptable to them.

Decide On The Nature Of Your Proposition

Finalise what are the details of the offer you are going to make to your creditors via the letter. Think through carefully and go over what you plan to do, to make sure you have considered all possible outcomes and will not regret later what you ask for now.

Be well informed on your rights -

Make sure that you really do owe what creditors claim that you owe. There have been known cases of fraud so if you are in doubt about a particular debt that you supposedly owe, do not be afraid to ask the creditor concerned to substantiate their claims. Also mention in your letter to the creditor about removing the debt from your credit report. Be certain that you are not wronged or short changed in this area.

Work on clarityHow you phrase your letter is of great importance. Make sure the way you write it clearly reflects your current situation. If there is a need, justify what you say with necessary evidence or details that will help your proposition be more appealing to the creditor.

Mind your manners -

It always pays to be polite. If you start off on a defensive, angry tone, you immediately kill your chances to having a favourable reply from your creditors. Find ways to state your case and get your way, but at the same time to show due respect to the creditor concerned.

Ask for confirmation -

Include in your letter a request for a signed agreement to be sent back to you once the creditor has accepted your terms. Remember to retain a copy of this for your own protection, and also send a copy to the credit bureau so that what has transpired is updated in your credit report.As daunting as it may seem, you will find that it's not really that hard to get your debt settlement letter written. Just be sure to keep in mind the pointers listed above and also to re-read and edit what you've written. Remember, your efforts to put together a well written letter might just save you from having to pay a much larger sum of money, not to mention avoiding stress and other related health problems.
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