Sometimes you can convince a creditor to agree to fully or partially "forgive" a debt, meaning that the amount is no longer owed (see Resolving Debts for a short discussion on debt forgiveness).
To record that a creditor has forgiven some or all of a debt,
It's worth noting that Debt forgiveness does not cause an entry to appear in the Cashflow tab, because no money changes hands. However, forgiven amounts are generally considered taxable.
See also Pay Off Debt to pay off any remaining amount owed.