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What is a Debt Repayment Schedule?
An Agreement on Repayment Schedule is a letter from one company acknowledging that another company or individual owes a certain amount of money and sets forth the dates and terms of repayment, typically in the form of a loan agreement between a borrower and lender that details a loan repayment schedule. The importance and primary purpose of a repayment schedule agreement is to protect the lender party or service provider because it legally enforces the company’s pledge to repay the loan either in regular payments or a lump sum. This letter is also useful to the company owing money as it explicitly clarifies the details of the loan or repayment method, further keeping them accountable for the payment.
Key points included
- Repayment schedule agreements may be used in cases of business loans, real estate loans, student loans, personal loans, or purchases.
- Ensure to include a detailed payment schedule and terms of payment, the amount due for payment, and a method of communicating a further delay of schedule, which may include the minimum number of days to communicate this delay.
- Outline whether repayment will be made on a fixed date or within a given time-frame.
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Paul Falzon
Director
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Jonathan Wong
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