Free Debt Settlement Letter Template

SETTLEMENT SUMMARY

Dear Apex Recovery Group, Inc. (collecting on behalf of National Credit Services, LLC),

I, John Michael Smith, am writing in reference to the above-referenced account (Account Number: ACCT-2024-88712). I acknowledge that the outstanding balance claimed by your records is approximately 12,500.00 USD. This letter constitutes a formal settlement offer made in good faith to resolve this matter and, to the extent that any modification of the original account agreement results, is submitted in writing consistent with the statute-of-frauds and contract-modification requirements of UCC § 2-209 and analogous state common law. This communication is made without prejudice to any rights, claims, or defenses I may have regarding this debt, including defenses arising under the applicable state statute of limitations on written contracts (e.g., Cal. Code Civ. Proc. § 337 [4 years]; N.Y. C.P.L.R. § 213 [6 years]; Tex. Civ. Prac. and Rem. Code § 16.004 [4 years]; Fla. Stat. § 95.11 [5 years on written contracts]), all of which are expressly reserved. Nothing herein shall operate as an acknowledgment, new promise, or partial payment capable of reviving or restarting the limitations period under the revival-of-debt doctrine.

I hereby offer to settle the above-referenced account in full for a total payment of 5,000.00 USD, representing approximately 40.0% of the claimed outstanding balance. This offer is contingent upon the creditor's written acceptance of all terms set forth in this letter prior to any payment being made. I make this offer based on my current financial circumstances and inability to pay the full claimed balance. This offer represents the maximum amount I am able to pay at this time. I understand that this settlement offer, if accepted, constitutes a compromise of a disputed or doubtful claim and is not an admission of liability for the full amount claimed.

Upon receipt of written acceptance of this settlement offer, I will remit a single lump-sum payment of 5,000.00 USD by April 30, 2026. Payment will be made via certified check, cashier's check, or electronic funds transfer to an account designated by the creditor in the written acceptance. I will not remit payment until I have received the creditor's written acceptance of all settlement terms, including the reporting condition specified in Section 3 of this letter. Personal checks will not be used to ensure prompt clearance and to provide a verifiable payment record.

As a material condition of this settlement, the creditor agrees to report this account to all three major consumer credit reporting agencies (Equifax, Experian, and TransUnion) as "Paid in Full" or "Account Paid, Zero Balance" within thirty (30) calendar days of receipt and clearance of the settlement payment. The creditor further agrees not to report the account as "settled for less than the full amount," "charged off," or any similar negative notation. This reporting condition is a material term of this agreement, and failure to comply shall constitute a breach entitling me to all available remedies under the Fair Credit Reporting Act (15 U.S.C. 1681 et seq.), including but not limited to actual damages, statutory damages, punitive damages, and attorney's fees. The creditor shall provide written confirmation of the updated credit reporting within forty-five (45) days of payment clearance.

Upon receipt and clearance of the settlement payment as specified above, the creditor agrees that the above-referenced account shall be considered fully satisfied and closed. The creditor, its successors, assigns, and any affiliated collection agencies shall permanently and irrevocably release, waive, and discharge me, John Michael Smith, from any and all claims, demands, actions, causes of action, obligations, costs, expenses, and liabilities of any kind arising out of or related to the above-referenced account, whether known or unknown, existing or contingent. The creditor further agrees not to sell, assign, transfer, or otherwise convey any remaining balance or claim related to this account to any third party, including but not limited to debt buyers, collection agencies, or law firms. Any attempt to collect any additional amount beyond the agreed settlement amount after payment has been received and cleared shall constitute a violation of this agreement and applicable federal and state consumer protection laws.

I require written confirmation of the acceptance of this settlement offer and all terms contained herein before any payment will be made. The written confirmation must be on the creditor's official letterhead (or, if a collection agency, on the agency's letterhead with specific authorization from the original creditor) and must include: (a) the account number referenced above; (b) the agreed-upon settlement amount; (c) the agreed-upon payment terms; (d) the agreed-upon credit reporting condition; (e) confirmation that the settlement constitutes full and final resolution of the account; and (f) a statement that no further collection activity will occur upon receipt and clearance of the settlement payment. Electronic confirmation via email is acceptable if sent from a verified company domain. This written confirmation requirement is a condition precedent to my obligation to make any payment under this agreement. If written confirmation is not received within fourteen (14) business days of the date of this letter, I reserve the right to withdraw this offer.

Nothing in this settlement offer shall be construed as a waiver of any rights I have under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. §§ 1692-1692p, the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq., the Equal Credit Opportunity Act (ECOA), 15 U.S.C. § 1691 et seq. (prohibiting discrimination in any aspect of a credit transaction), or any applicable state consumer protection statutes. I expressly reserve: (a) the right to dispute the validity, amount, or enforceability of this debt at any time prior to final settlement; (b) the right to request validation of the debt pursuant to 15 U.S.C. § 1692g; (c) the right to file complaints with the Consumer Financial Protection Bureau (CFPB), which has supervisory and enforcement authority under 12 U.S.C. § 5491 et seq., the Federal Trade Commission (FTC), and applicable state attorneys general; (d) all rights and defenses available under the applicable state statute of limitations on debt, including the rule that this communication shall not constitute an acknowledgment of the debt or a new promise sufficient to toll or restart the limitations clock; and (e) all rights to assert claims for violations of the FDCPA, including harassment (15 U.S.C. § 1692d), false or misleading representations (15 U.S.C. § 1692e), and unfair practices (15 U.S.C. § 1692f), with statutory damages available under 15 U.S.C. § 1692k. This letter is not an acknowledgment of the validity of the debt, a new promise to pay, or a waiver of any applicable statute of limitations defense. This settlement offer is made solely for the purpose of resolving a disputed or doubtful claim in the most efficient and practical manner.

This settlement offer is made on a "without prejudice" basis, meaning that this letter and any communications related to this settlement negotiation cannot be used as evidence of liability or as an admission of the validity of the claimed debt amount in any legal, arbitration, or administrative proceeding. If this offer is not accepted, all terms proposed herein are automatically withdrawn and shall have no legal effect. The offer amount shall not be construed as establishing a floor or benchmark for any future negotiations or legal proceedings. Neither party shall reference this offer or any related communications in any judicial or administrative proceeding without the express written consent of the other party.

This settlement offer shall remain open for acceptance until April 15, 2026 (the "Expiration Date"). If written acceptance is not received by the Expiration Date, this offer shall be deemed automatically withdrawn, and I shall be under no obligation to make any payment. The creditor may accept this offer by providing the written confirmation described in this letter to the address listed above. Time is of the essence with respect to the Expiration Date. Any acceptance received after the Expiration Date shall be of no force or effect unless I provide a separate written extension of the offer period. I reserve the right to withdraw this offer at any time prior to the Expiration Date by providing written notice to the creditor.

I understand that a creditor that discharges indebtedness of $600 or more is required to file IRS Form 1099-C (Cancellation of Debt) pursuant to IRC § 6050P and 26 C.F.R. § 1.6050P-1, and that the forgiven amount is generally includible in the debtor's gross income as discharge-of-indebtedness income under IRC § 61(a)(11) and § 108(a). I acknowledge that exclusions from gross income may apply, including the insolvency exclusion under IRC § 108(a)(1)(B) (to the extent the taxpayer is insolvent immediately before the discharge), bankruptcy under § 108(a)(1)(A), qualified farm indebtedness under § 108(a)(1)(C), qualified real property business indebtedness under § 108(a)(1)(D), and qualified principal residence indebtedness under § 108(a)(1)(E). I acknowledge that the tax consequences of this settlement are my sole responsibility, and I have been advised to consult with a qualified tax professional regarding any potential tax liability arising from this settlement. The creditor's obligation to issue Form 1099-C under IRC § 6050P is independent of and does not affect the finality of this settlement agreement.

This settlement agreement, once executed by both parties, shall be governed by and construed in accordance with federal law, including the Fair Debt Collection Practices Act (15 U.S.C. 1692 et seq.) and the Fair Credit Reporting Act (15 U.S.C. 1681 et seq.), as well as the laws of the state in which the debtor resides. In the event of any dispute arising out of or related to this agreement, the parties agree to first attempt resolution through good-faith negotiation. If negotiation is unsuccessful, either party may pursue any available legal remedy. The prevailing party in any legal action to enforce the terms of this agreement shall be entitled to recover reasonable attorney's fees and costs from the non-prevailing party. This agreement constitutes the entire understanding between the parties regarding the settlement of the above-referenced account and supersedes all prior negotiations, representations, and agreements, whether written or oral.

I trust that this offer will be given serious consideration. I believe this settlement is in the best interest of both parties, as it provides a prompt and certain resolution without the expense and uncertainty of continued collection efforts or litigation. I look forward to receiving your written acceptance within the timeframe specified above.

Please direct all correspondence regarding this matter to the address listed at the top of this letter.

RESPECTFULLY SUBMITTED,