Put an overdue debt on a payment plan. Debtor acknowledges the debt and agrees instalments; acceleration on default. Business-to-business, English law. From £4.99.
A Payment Plan Agreement records that a business debtor owes an existing, already-due debt and will clear it in instalments, in return for the creditor agreeing not to enforce while the schedule is met. It is a forbearance arrangement — the original debt survives and the creditor's full rights revive on default — not a new loan and not a novation.
When a business that owes you money cannot pay it all at once and you would rather recover it over time than go to court. It sits between a Late Payment Letter and a Letter Before Action: the debtor has responded that they cannot pay in full, and you want the arrangement in writing, with the debt acknowledged and a clear consequence if they miss a payment.
A written acknowledgement of the debt by the debtor (which restarts the limitation clock in the creditor's favour under the Limitation Act 1980), the instalment schedule, interest treatment, and an acceleration clause under which the whole outstanding balance falls due if the debtor defaults. Where the creditor accepts a reduced sum in full and final settlement, the document is drawn up as a deed, so that the writing-off of the balance is enforceable (Foakes v Beer). It is for business-to-business debts only.
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