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Reducing a Debt Amount Through a Debt Settlement Letter

By: Jeslyn Jessy

For people who intend to solve their debt issues on a personal basis, writing a debt settlement letter to the creditors is a smart move. A good debt negotiation letter can actually assist the people in debt to become debt free at a faster pace.

Convincing your creditors to settle your debt at a much lower amount is a challenging task. However, if you manage it tactfully, the debt reduction process can be done successfully in an economical way. Let’s spend some time to read the following tips.

First thing first, you need to do proper preparations before writing a letter. Gather all the detailed information about your debts. You must list down the repayment amount of each debt, the interest rates, total outstanding balance, surcharges, taxes and other related terms. It is important for you to know the exact figure of how much you owe. At the same time, you must evaluate your current financial ability to see whether you have sufficient fund to pay off the debt. Knowing your bargaining chip will help in getting the better deal.

If you don’t really understand how the process of debt settlement works, you are advised to contact the professional service provider or lawyer for clearer clarification before you start writing settlement letter. Even if you have drafted the letter, in order to play safe, get the professional to go through the content before you send out to the creditor.

After thorough checking, you can then post the letter and wait for the reply from the creditor. You are reminded to follow up closely with your creditor in order to know the status of your request.

There is a reminder for you. You may fail in your first attempt but you should keep trying by offering a relatively higher repayment amount until you get the consent from your creditor.

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