You may not like this answer, but you should... hire another attorney. Find one who handles legal malpractice cases. You need atty2 to review the facts of the malpractice and your damages and give an opinion on whether $8000 is a reasonable settlement amount. You also need advice on how to know whether atty 1 has professional liability insurance that was in effect when the malpractice occurred.
If it is a reasonable settlement (or if it is the best you can expect to get because the lawyer doesn't have professional liability coverage or much money) then you want atty2 to draft a settlement agreement for you. You need to know about your options for enforcement of the agreement if payments are late or unpaid. That could be a "liquidated damages" clause which provides that atty1 will owe owe you additional money if a payment is late, or it could be a promissory note, or an agreed judgment that would be collectible if he defaults (for that you would need to file a suit, so that is likely the least desirable option).
It would be reasonable to add the amount of your attorney fees for atty2 to the settlement amount.