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Debt settlement offer checker

Copy the terms from a creditor, collector, or debt buyer’s offer. The checker points out missing agreement language and payment risks before you pay.

Check the offer

Use this tool when: a creditor, collector, or debt buyer has asked you to pay a reduced amount to settle an account.

Before comparing percentages, review what debt settlement does—and what it does not automatically change about a lawsuit, credit reporting, or canceled debt.

01
Match the debt to your records

Check the account, balance, original creditor, and current owner.

02
Read what the payment settles

The letter should settle the entire debt and release the remaining balance.

03
Save proof after every payment

Keep the signed letter, receipts, final confirmation, and any tax form.

Check the written offer

Copy the terms before you pay

Use the balance and wording from the letter. The checker finds missing terms and payment risks. It does not recommend a percentage or tell you whether to accept.

01

Record the offer

The debt owner and the company that sent the letter may be different.

02

Check for reasons to pause

Choose “Not sure” when the letter or your records do not answer the question.

Have you confirmed the account, amount, current owner, and authority to collect?

Use a validation notice, statements, and contact information you independently verified.

Could this debt be old enough for a statute-of-limitations issue?

Choose “Not sure” if you cannot confirm the last-payment date, applicable state, or limitation period.

Has a lawsuit been filed, or have you received court papers?

A settlement call does not by itself extend a court response deadline.

Do you have the complete settlement offer in writing?

A voicemail, phone call, or payment screen may omit the promise to forgive the remaining balance.

Can every payment fit without skipping essentials or court-ordered obligations?

Check the actual installment dates against income, housing, food, utilities, insurance, and other required payments.

03

Read the written agreement

Answer from the document, not from what someone said on the phone.

Does the written offer clearly identify the account?

Look for your name and a masked account number or another identifier you recognize. Do not enter a full account number here.

Does it say the agreed payments settle or satisfy the entire debt?

The letter should say that completing every agreed payment settles the entire debt. Acceptance of one payment is not enough.

Does it say the owner will not collect or sell the remaining balance?

Look for a clear release of the balance left after every settlement payment clears.

Does it state how the account will be reported to credit bureaus?

Record the actual wording. Do not assume settlement means deletion from a credit report.

Is the agreement signed by the owner or an authorized collector?

Look for a signature and confirm that the company making the promise has authority to settle the account.

Will you keep the agreement, every receipt, and final confirmation?

Save each payment confirmation and ask for a final statement showing that you completed the settlement.

Check the paper trail

The percentage says nothing about whether the offer is affordable or enforceable.

Your review will appear here.

Leave a field blank if the offer does not answer it. The review will list what is missing.

Beyond the percentage

Start with the signed agreement

The percentage describes one part of the offer. Check the debt owner, the age of the debt, any court deadline, and the tax treatment separately.

Check who owns the debt

CFPB guidance says to confirm that you owe the debt and calculate a realistic payment plan. Verify the company and current owner through contact information you found yourself.

Open the collector details check

A court deadline comes first

Settlement talks alone do not pause a case. Check the service date and follow the court’s response instructions by the deadline.

Open the court-papers guide

The balance difference is not a tax bill

The IRS generally treats canceled debt as taxable unless an exception or exclusion applies. The amount shown by the checker may not match taxable income.

Read the settlement tax guide

Before paying

Questions about the offer

Does a lower settlement percentage mean I should accept the offer?

No. It only shows the offer amount divided by the stated balance. It does not confirm who owns the debt, what the agreement releases, whether you can afford the payments, how the account will be reported, or how canceled debt will be taxed.

What should a debt settlement agreement say before I pay?

The signed letter should identify the account and current owner, list every payment amount and due date, say that completing the payments settles the entire debt, release the remaining balance, and state how the account will be reported.

Is the canceled-balance estimate the tax I will owe?

No. The checker only subtracts the offer from the stated balance. The IRS generally treats canceled debt as taxable unless an exception or exclusion applies. This tool cannot determine canceled-debt income, Form 1099-C treatment, an exclusion, or the tax owed.

Can I focus on settlement if I have already been sued?

Meet the court response deadline first. Settlement talks alone do not pause the case, extend the deadline, or replace the required response.