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A debt settlement agreement confirms the renegotiation between a debtor and a creditor, typically reducing or eliminating the original debt. This agreement allows the creditor to forgive part of the debt, releasing the debtor from any remaining obligations. In exchange, the debtor usually makes a final payment to the creditor after the agreement is executed. The creditor is then obligated to remove any obligations of the debtor under the original contract and renounce pursuing any actions against the debtor related to the original agreement.