Payment Plan Agreement by EasyLegalDocs
This document outlines a formal agreement between a Debtor and a Creditor for the repayment of an outstanding debt. It details the initial payment, subsequent installment amounts, payment schedule, and acceptable payment methods. The agreement also specifies the consequences of a breach, such as acceleration of the entire debt.
PAYMENT PLAN AGREEMENT
This Payment Plan Agreement (hereinafter referred to as the "Agreement") is made and effective as of [effective date] (the “Effective Date”),
BY AND BETWEEN: | [debtor name], with an address of [debtor address], hereinafter referred to as the “Debtor”. |
AND: | [creditor name], with an address of [creditor address], hereinafter referred to as the “Creditor”, collectively referred to as the “Parties”, both of whom agree to be bound by this agreement.. |
Representation and Warranty
The Debtor represents and warrants that they have created this Agreement, including the repayment schedule, believing they can satisfy the Creditor's demands without interruption, barring unforeseen changes in circumstances.
Debt
The Debtor agrees to settle the owed amount of [debt amount owned] (the "Deficiency") and wishes to make payment. This Agreement does not relinquish any unpaid amounts and should there be a violation of this Agreement by the Debtor, the Creditor's rights to the Deficiency will remain in effect.
Settlement
The Debtor shall pay the full amount of [first payment amount] at the time of signing this Agreement. The remaining balance shall be paid in installments of [monthly installment amount] on the 1st of each month, until payment is made in full, without any extra charges or interest.
Payment Method
The Debtor shall make the payment to the Creditor with the address set forth above through either cash, check, or bank transfer.
Warranties
The Parties agree to release each other from responsibility for the existing debt, except for issues pertaining to this Agreement's conditions. Additionally, the Creditor will remove any credit record of the Debtor upon the Agreement's completion.
Acceleration upon Breach
If the Debtor fails to meet the payment schedule outlined in this Agreement, including but not limited to:
Missing a monthly installment payment on the due date.
Failing to make the initial payment at the time of signing this Agreement.
Making payments that are less than the agreed-upon monthly installment amount.
Using a payment method that is not in accordance with the Payment Method section of this Agreement.
Then, after ten calendar days of such a breach, the entire amount of the Deficiency will be immediately due, and the Creditor shall have the right to pursue any legal remedies available to collect the outstanding debt.
Modification
No modification or amendment to this Agreement shall be valid unless in writing and signed by the Parties.
Successors and Assigns
This Agreement will be applicable to and beneficial to both parties involved as well as their successors and assigns.
Applicable Law
This Agreement and its provisions are to be determined in accordance with California law without regard to its conflicts of laws principles.
Acceptance
The Debtor hereby accepts and agrees to the terms of this Agreement.
Signature
IN WITNESS WHEREOF, each of the Parties has executed this Agreement as of the day and year set forth below.
[debtor name]
Signed:
______________________________
Address:
______________________________
Date:
_________________
[creditor name]
Signed:
______________________________
Address:
______________________________
Date:
_________________
5.0 out of 5 on Google
Read reviewsAs seen in
About this template
What is this template?
This document is a formal schedule for liquidating a debt and is not a release of claims until the final payment is cleared. It specifically includes provisions for cash, check, or bank transfer payments and an automatic acceleration of the full debt upon breach. It is not an unsecured promissory note as it explicitly ties the repayment to an existing deficiency and credit reporting obligations.
When should you use it?
Use this agreement when a specific amount of debt is already owed and both parties want to formalize a monthly payment schedule. If the debt is being settled for a lower amount than originally owed in exchange for a single payment, use a Debt Settlement Agreement instead.
What's inside
| Clause | Name | What it does |
|---|---|---|
| Debt | Debt | The Debtor acknowledges the total Deficiency amount and agrees that the Creditor retains rights to any unpaid portions if a violation occurs. |
| Settlement | Settlement | The Debtor pays a specific first payment amount at signing followed by monthly installments due on the 1st of each month. |
| Warranties | Warranties | The Creditor agrees to remove the Debtor's credit record upon completion of all payments required under this Agreement. |
| Acceleration upon Breach | Acceleration upon Breach | The entire Deficiency becomes immediately due if the Debtor fails to remedy a payment breach within ten calendar days. |
| Applicable Law | Applicable Law | The parties submit to California law for the determination of the Agreement's provisions and legal interpretation. |
Who it's for
- a creditor allowing a debtor to pay off a known deficiency through monthly installments
- a debtor seeking the removal of a credit record in exchange for completing a structured repayment plan
- parties in California requiring a debt settlement contract with a ten-day cure period before acceleration
How long it runs and how it's signed
California note
This version is drafted for California. US contract and employment rules vary by state, so it will not transfer cleanly elsewhere. Tell GitLaw where the parties are and it adjusts the draft.
Frequently asked questions
A template isn't binding on its own - like any contract, it becomes binding once it's properly completed and signed. Templates in our curated library are professionally drafted for US or UK law; review any template before you sign it.
Yes. Chat with GitLaw to edit any section, or make changes directly in the editor.
Yes, read about team plans here.
Describe what you need in the chat and GitLaw will draft it for you.
Templates in our curated library are professionally drafted for US or UK law. The wider library comes from the GitLaw community and public sources - a solid starting point, but check any template fits your situation before you rely on it.
Mostly US and UK law. Some templates use general commercial terms that work across jurisdictions, and many note which law they're written for.
It depends on the situation. Templates work well for routine business agreements. For anything involving significant money, complex IP, employment, or areas you're unsure about, it's worth getting professional advice before you sign. GitLaw provides templates and tools, not legal advice.
Open any template in GitLaw and describe the change you want in the chat — 'make clause 4 mutual' or 'add a 30-day notice period', for example. GitLaw drafts the revised language and shows it as a suggested edit. You accept, reject, or keep editing from there.
Yes. Upload a Word, PDF, or Markdown file and GitLaw will open it in the editor. You can review, edit, or chat with GitLaw about it the same way you would with any template from the library.
Trusted by 5,000+ businesses
From template to signed, in one place
Every template opens in an editor with an AI agent alongside it.
Open
Pick a template and open it. Nothing to download, and no credit card to start.
Free to open
Edit with AI
Describe your situation in chat and the agent adapts the wording, clause by clause.
Tracked changes you can review
Send and sign
Share it for negotiation, then collect signatures without leaving GitLaw.
eSign included
Built for your legal work,
with practicing lawyers
Trained on 5,500+ clauses and specialist areas of law. Built with a standards committee of independent lawyers.
As seen in
Ready to get started?
No sales calls, no credit card. Just chat with GitLaw.
GitLaw provides templates and tools, not legal advice. Templates are a starting point, not a substitute for advice on your situation - for anything significant, speak to a qualified lawyer.