No matter how good your business writing skill is, before sending your debt settlement proposal to your creditors, it is a must for you to draft the letter and get a lawyer or legal consultant to go through it in order to avoid inconsistency.
It is not the matter of writing an essay to inform your creditors about your financial situation. It is a formal proposal that can assist you to eliminate your total debt. Bear in mind that this particular letter is a legal binding letter. Once you put all your points in words, they have become your responsibilities.
Below are 5 important points you must include in your letter:
1) The details of your debt and how long the past due is
You need to indicate your account number and the total outstanding clearly in your letter.
2) A brief outline about your current financial position and the difficulties you are facing
You must inform your creditors about the hardship you are facing in a summarized manner. If you have supporting documents to prove, you should attach them with your letter.
3) Propose a settlement amount which you can afford to pay
You need to assess your financial position carefully to see how far your financial ability is.
4) State the date you are going to pay if the settlement amount is agreeable
You are advised to show your sincerity to your creditors that you really want to get rid of your debt as soon as possible.
5) State your intention if the settlement is not accepted by the creditors
You can inform your creditors that you may file bankruptcy if your request is being rejected by them. Generally, the creditors counter offer when they don’t accept your proposed amount.
To sum up, a debt settlement letter is not a normal letter and yet it contains legal effect.
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