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A debt settlement agreement is a confirmation of the renegotiation or settlement between a debtor and creditor. It typically reduces or eliminates the original debt, allowing the creditor to forgive part of it and release the debtor from any remaining obligation. After the debtor makes the final payment stipulated in the agreement, the creditor is expected to remove any obligations under the original contract and relinquish the right to pursue any action against the debtor regarding the original agreement.
