Previously Settled Debt Letter

Use this letter when you’ve already settled (or paid off) a debt, but now a different collector is demanding payment!

Given the millions of delinquent accounts sold on the junk debt buyer (JDB) market, mistakes happen.  In fact, every day, people receive calls from collectors demanding payment on accounts they settled (paid less than the full balance) months or even years ago. When this happens to you, use this letter to formally tell collectors that you already settled or paid off the debt. Use the free sample letter below to assist you in composing your own previously settled debt letter.

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Free Sample Letter Previously Settled Debt Letter


Your Name
Home Address
Phone Number

Attention: {name of collector if known}
Name of Debt Collection Agency

RE: Collection letter dated {date of letter here} or phone call on {date of call here} reference account #: {account or reference number}

Dear Mr. /Ms. {Collector’s Name or the name of the Collection Agency}

This letter is to inform you that I settled the account in question on [insert date] with [insert name of collection agency].  I have enclosed copies of the settlement letter and proof of payment.  You now have proof that this debt is no longer collectible; therefore, I demand that you remove this account and all references to my personal information from your records.

I do not expect to hear from you again regarding this matter, however, should you choose to ignore this notification, I will consider any contact not per the Fair Debt Collection Act, a serious violation of the law and will immediately report any violations to my State Attorney General and the Federal Trade Commission and, should it become necessary, take legal action to protect my myself.


Your Printed Name

Note: Send this previously settled debt letter via “return receipt requested” and keep a copy for your records.