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A debt settlement agreement confirms the renegotiation or settlement of the original terms between a debtor and creditor. It typically reduces or eliminates the debt amount and allows the creditor to forgive part of the debt, releasing the debtor from any remaining obligations. This usually occurs after the debtor makes their final payment following the execution of the agreement. Additionally, the creditor is required to remove any obligations of the debtor under the original contract and relinquish the right to pursue any actions against the debtor related to the original agreement.