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A debt settlement agreement is a formal document that confirms the renegotiation of a debt between a debtor and creditor. It typically reduces or eliminates the original debt amount and allows the creditor to forgive part of it, releasing the debtor from any remaining obligations. This forgiveness usually occurs after the debtor makes the final payment. Additionally, the creditor is required to remove the debtor's obligations under the original contract and relinquish the right to pursue any auction related to that agreement.
