With this payment plan template, you can state your payment plan’s specifics and ensure thorough understanding and agreement from everyone involved. Use it as a guide or fill in the blanks according to your needs.
This payment plan agreement is made by and between
[Debtor.FirstName] [Debtor.LastName] , with an address at [Debtor.StreetAddress] , [Debtor.City] , [Debtor.State] [Debtor.PostalCode] referred to as the “Debtor,”
[Creditor.FirstName] [Creditor.LastName] with an address at [Creditor.StreetAddress] , [Creditor.City] , [Creditor.State] [Creditor.PostalCode] referred to as the Creditor, collectively referred to as “Parties,” and is made effective on the (date).
The Debtor agrees to pay the Creditor an amount of $(insert amount) in a structured payment plan according to the terms and conditions provided below. This sum responds to (add services or goods if applicable, e.g., a car), and at the time of the agreement, the Debtor owes $(insert amount) to the Creditor.
Both parties agree to the following payment plan until the debt is completely paid off: (Describe the payment plan)
The total amount of $(insert amount) will be paid with installments of $(insert amount) to be paid on (insert the day, e.g., the first of each month, bi-weekly), and with an interest rate of (insert number)% compounded annually. The payment method will be (add method).
When describing the payment plan, add if there is a down payment, the interest rate, and any repayment instructions. Make sure everything is specified to avoid any legal loopholes.
The Debtor agrees to pay off the debt according to the established period in this agreement from the moment it is made effective until (date). Any delays or breaches of the established terms will result in a %(insert number)fee added to the owed sum every (insert number and period, e.g., 5 days, 2 weeks, 1 month, etc.)
The Creditor requires the Debtor to have at least one guarantor who hereby agrees to assume all the Debtor’s responsibilities in case of a contract breach. Hereby, the guarantor guarantees the prompt fulfillment of all existing duties and obligations of the Debtor, and the repayment of $(insert amount), under the terms of this agreement and up to a limit of $(insert amount). If the Debtor fails to repay the loan, the guarantor is financially responsible for repaying all remaining debt plus interests by the limit established hereby.
A guarantor is not always required but is recommended in cases where the debtor doesn’t have a good credit score. It can be a friend, family member, or the debtor’s partner.
If the Debtor fails to provide the payments and fulfill the payment plan within the time frame established in this contract, the Creditor has the right to declare the remaining amount and applicable interests, if any, immediately due and payable. The Debtor will be considered in default after (insert number, e.g., three) failed payments. In that situation, the Creditor also has the right to pursue further legal action based on the terms and conditions of this agreement.
This agreement is made under the frameworks and follows the laws of (insert jurisdiction, e.g., city, state).