Debt Settlement Letters – Myths & Misunderstandings Galore!

In October 14, 2011

In my 14 years as a debt settlement professional, I’ve reviewed thousands upon thousands of debt settlement letters. Last year alone we had about 1,200 of them to review and approve on behalf of our clients. If there is one subject I know well, it’s how to document a settlement! There is nothing especially difficult about it, but I continue to be astonished at the amazing amount of bad information floating around Read More …


  1. I reached a settlement agreement with Discover for a one time payment of $2000 on a $8000 debt. I received the settlement letter from Discover and mailed out money orders as payment the next day. They cashed the money orders but then wrote back with two cashier’s checks of $1000 each and a letter stating they were not accepting the agreement. In my letter to them attached with the payment it stated that by keeping or cashing the money orders they were agreeing to our established arrangement and the debt would be considered “settled in full”. My question is, should I return the cashiers checks to them and note I am declining to accept them as by cashing the original money orders sent as payment they accepted our established agreement? I feel, and it was stated in my letter, that if they had any issues/ concerns they were to return the original payment sent (money orders) and notified me of the problem issue.

    • David, the situation you are describing is very unusual. I don’t have enough information to advise you, sorry. I would have to see a copy of the original letter you received from Discover documenting the agreement, and also discuss the situation in more detail with you. If you want help with this, please order my Document Review Service on the A La Carte menu, thanks.

  2. If a settlement. doesn’t have an account number is it legal.

    • Tiffany, it’s not a question of being “legal” or not. It’s a question of properly documenting the settlement. If there is no indication of an account number on the letter, then there would be no way to prove later on that you have settled this specific account. So I would never accept a settlement letter that did not clearly and properly identify the account to be settled.

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