Full and Final Settlement Offer – Sample Letter Template
MoneyNerd introduces enquiries to The Debt Advice Service and may receive a referral fee. For free, independent guidance and help finding a debt adviser, visit MoneyHelper.
This information and enquiry service is not a full financial assessment or a guarantee of suitability or debt write-off. Debt solutions are not suitable for everyone. Fees may apply, and your credit record and assets may be affected. Get advice on your circumstances before choosing a solution.
MoneyNerd introduces enquiries to The Debt Advice Service and may receive a referral fee. For free, independent guidance and help finding a debt adviser, visit MoneyHelper.
This information and enquiry service is not a full financial assessment or a guarantee of suitability or debt write-off. Debt solutions are not suitable for everyone. Fees may apply, and your credit record and assets may be affected. Get advice on your circumstances before choosing a solution.
Are you searching for how to write a full and final settlement letter? You’re at the right place. Every month, over 170,000 people visit our website for trusted advice on debt solutions.
Writing a formal letter to solve your problem might feel hard. But don’t worry, we’re here to help.
This article will show you:
- What a full and final settlement offer is.
- How to make a reasonable settlement offer.
- What a full and final settlement letter looks like.
We understand how you feel. That’s why we’ve created a free letter template for you to use. Take a look below.
Full and Final Settlement Letter Template
To Whom It May Concern
Regarding Case #: [your case number]* (required)
I am writing about the money which you are claiming on the above account.
I can confirm that I am unable to pay the money which I owe in full.
[include a paragraph explaining your circumstances and details of your financial situation that you want the creditor to take into account.]*. (required)
However, I can raise £[enter the amount which you can afford to pay.]* (required) and I want to offer this as full and final settlement of the account. I am making this offer on the clear understanding that, if you accept it, neither you nor any associate company will take any other action to collect or enforce this debt in any way and that I will be released from any liability.
If you accept this offer, please confirm that you will mark my credit reference agency file to show that the above account has been paid and closed.
I can pay the amount I have offered within[enter the number of days or weeks within which you will pay]* (required) of receiving your written agreement of this offer.
Please give me details of how I can pay.
I look forward to hearing from you.
Yours sincerely
Downloadable Resource
The download links below take you to a Google document template where you can make a copy or save in any document format you like. Note, you may have to login to your Google account.
Download – Single (for one person)
Download – Joint (for couples)
What is a full and final settlement offer?
A full and final settlement offer is a proposed payment from a debtor to a creditor to clear the debt.
The offer will be below the total value for the money owed but will be paid in one lump payment, which is attractive to creditors because they don’t have to wait to get most of the money.
The settlement offer will save the debtor money and prevent them from having to pay interest on an outstanding amount for many months or even years.
Debt advice: Continue to the debt enquiry form
Advertisement. MoneyNerd is a commercial introducer, not a debt adviser. The Debt Advice Service, a trading style of Pacific Financial Solutions Limited, offers free debt advice with no obligation. If you request an introduction, your details are shared with them so they can contact you.
Some debt solutions have fees and may negatively affect your credit rating. MoneyNerd may receive a fee if you proceed with a debt solution through The Debt Advice Service. MoneyHelper offers free, impartial money guidance and help finding free debt advice.
An example would be offering to pay £800 in one payment rather than paying £100 per month (+ interest) for ten months of a debt worth £1,000.
You might choose to do this because your financial situation has improved – as well as to save money.
Note, it will remain on your credit file for six years that you never paid the debt back in full.
How the introduction works
The Debt Advice Service can discuss your circumstances and explain available options, including their benefits, costs and risks.
Options depend on your circumstances. You decide whether to proceed.
Advertisement. MoneyNerd introduces enquiries; we do not give debt advice or recommend solutions. The Debt Advice Service, a trading style of Pacific Financial Solutions Limited, offers free debt advice with no obligation. Complete the enquiry form to share your details and request a call.
Some debt solutions have fees and may negatively affect your credit rating. MoneyNerd may receive a fee if you go ahead with a debt solution through The Debt Advice Service. For free, impartial guidance and help finding free debt advice, visit MoneyHelper.
What is a full and final settlement letter?
A full and final settlement letter is a letter to your creditor proposing an offer for settlement.
It should clearly explain the amount you are offering to pay to clear the debt and explain why this is beneficial for you and the creditor together.
Our free full and final settlement letter template does just that!
How do you write a final settlement letter?
Settlement offers should be written directly to your creditor and explain your circumstances clearly.
Some people find it difficult to find the right words or explain themselves easily. That’s why Money Nerd created a free debt settlement offer letter template that you can find above.
What is a reasonable settlement offer?
There is no exact figure that makes a reasonable settlement offer.
You should only offer what you can comfortably repay in one payment.
Most people will not expect an offer below 70% of the debt’s value to be accepted, but it is not impossible. It all depends on mitigating circumstances and the value of the total debt.
About The Debt Advice Service
Use the enquiry form to request a call about your circumstances and available options. You decide whether to proceed.
Advertisement. MoneyNerd introduces enquiries; we do not give debt advice or recommend solutions. The Debt Advice Service, a trading style of Pacific Financial Solutions Limited, offers free debt advice with no obligation. Complete the enquiry form to share your details and request a call.
Some debt solutions have fees and may negatively affect your credit rating. MoneyNerd may receive a fee if you go ahead with a debt solution through The Debt Advice Service. For free, impartial guidance and help finding free debt advice, visit MoneyHelper.
Is full and final settlement legally binding?
Full and final settlement offers are not entirely legally binding.
But if you have an agreement in writing, it will be impossible for a court to make you pay more in the future.
Always make sure you get the agreement in writing from your creditor and always read the terms and conditions. You may want to get the help of a debt charity at this stage.
