Installment Payment Agreement Template

Installment Payment Agreement Template

This Installment Payment Agreement (“Agreement”) is made as of [Date] (“Effective Date”) by and between:

Seller / Creditor:
[Seller/Creditor Legal Name]
[Entity Type or “Individual”]
[Address]
[City, State/Province, ZIP/Postal Code, Country]
Email: [Email]
Phone: [Phone Number]

Buyer / Debtor:
[Buyer/Debtor Legal Name]
[Entity Type or “Individual”]
[Address]
[City, State/Province, ZIP/Postal Code, Country]
Email: [Email]
Phone: [Phone Number]

Seller and Buyer may each be referred to as a “Party” and together as the “Parties.”

1. Purpose of Agreement

The purpose of this Agreement is to set out the terms under which Buyer will pay Seller for the following goods, services, or debt balance by installments.

2. Description of Goods / Services / Debt

Buyer agrees to purchase from Seller, and Seller agrees to provide to Buyer, the following (“Subject Matter”):

[Description of goods, services, or existing debt being paid off]

Any additional details may be attached as Exhibit A – Description of Goods/Services and are incorporated into this Agreement.

3. Purchase Price and Down Payment

3.1 Total Amount.
The total amount to be paid by Buyer under this Agreement is [Total Amount in Numbers and Currency] ([Total Amount in Words]) (the “Total Amount”).

3.2 Down Payment.
Buyer shall pay a down payment of [Down Payment Amount and Currency] on or before [Down Payment Due Date].

3.3 Amount to Be Paid in Installments.
After the down payment is received, the remaining balance of [Balance Amount and Currency] (the “Installment Balance”) shall be paid according to the installment schedule in Section 4.

4. Installment Schedule

4.1 Number and Amount of Installments.
Buyer shall pay the Installment Balance in [Number] installments, each in the amount of [Installment Amount and Currency], unless adjusted as permitted by this Agreement.

4.2 Due Dates.
Each installment is due on [Due Day, e.g., “the 1st day of each month”] starting on [First Due Date] and ending on [Final Due Date].

4.3 Payment Method.
All payments shall be made in [Currency] by [Bank Transfer / Check / Electronic Transfer / Other] to the following details, unless Seller provides updated details in writing:

• Account Name: [Account Name]

• Bank Name: [Bank Name]

• Account Number / IBAN: [Account Number / IBAN]

• SWIFT / BIC (if applicable): [SWIFT/BIC]

• Payment Reference: [Reference for Buyer to include]

5. Interest and Charges (Optional)

5.1 Interest.
The unpaid portion of the Installment Balance shall bear interest at a rate of [Interest Rate]% per year, calculated on a [simple / compound] basis from [Interest Start Date] until paid in full.

5.2 Inclusion of Interest in Installments.
The installment amounts in Section 4 either:

• Include interest (principal and interest combined); or

• Exclude interest, which will be added and shown in a separate statement.

[Select one option and delete the other.]

5.3 Legal Limits.
If the agreed interest or charges exceed the maximum allowed by applicable law, they shall automatically be reduced to the lawful maximum, and any excess already paid shall be treated as a payment toward principal.

6. Late Payments and Default

6.1 Late Payment.
A payment is late if it is not received within [Number] days after the due date.

6.2 Late Fee.
For each late installment, Buyer shall pay a late fee of [Late Fee Amount or Percentage], subject to applicable legal limits.

6.3 Default.
Buyer will be in default under this Agreement if:

• Any installment remains unpaid more than [Number] days after its due date; or

• Buyer materially breaches any other obligation under this Agreement and does not correct the breach within [Number] days after written notice from Seller.

6.4 Acceleration.
Upon default, Seller may, by written notice to Buyer, declare the entire remaining unpaid balance (including any interest and fees that have accrued) immediately due and payable.

6.5 Collection Costs.
If Seller reasonably incurs costs to collect overdue amounts after default, Buyer shall pay reasonable collection costs, including reasonable attorney’s fees and court costs, to the extent permitted by law.

7. Ownership, Security, or Collateral (Optional)

7.1 Retention of Title (for Goods).
Unless stated otherwise in this Agreement, legal title to any goods shall remain with Seller until the Total Amount and all interest and fees (if any) have been paid in full. Buyer shall not sell, transfer, or encumber the goods before title passes without Seller’s written consent.

[Alternatively or additionally:]

7.2 Collateral.
As security for Buyer’s obligations, Buyer grants Seller a security interest in the following property (“Collateral”):

[Description of collateral]

Buyer agrees to sign any documents needed to record or perfect Seller’s security interest as required by law.

8. Prepayment

8.1 Right to Prepay.
Buyer may prepay all or part of the remaining balance at any time without penalty, unless prohibited by applicable law.

8.2 Application of Prepayments.
Unless required otherwise by law, any prepayment shall be applied first to any accrued interest and fees (if any) and then to the remaining principal balance.

9. Representations and Covenants

9.1 Buyer’s Statements.
Buyer represents that Buyer has read and understands this Agreement, has the legal capacity to enter into it, and is not relying on any promises or statements that are not written in this Agreement.

9.2 Seller’s Statements.
Seller represents that Seller has the right to enter into this Agreement and to receive payments under it.

9.3 Change of Contact Details.
Each Party shall promptly notify the other in writing of any change in address, email, or phone number.

10. Notices

10.1 Form of Notice.
Any formal notice under this Agreement must be in writing and sent by hand, mail, courier, or email to the contact details shown at the beginning of this Agreement, or to any updated details provided in writing.

10.2 Effective Date of Notice.
Notices will be considered received on the date of actual delivery or, for email, on the date sent if no error or bounce-back message is received.

11. Governing Law and Dispute Resolution

11.1 Governing Law.
This Agreement shall be governed by and construed in accordance with the laws of [State/Province, Country], without regard to conflict-of-law rules.

11.2 Dispute Resolution.
If a dispute arises in connection with this Agreement, the Parties shall first try in good faith to resolve it through informal discussions. If they cannot resolve the dispute within [Number] days after one Party sends a written notice of dispute, either Party may pursue [court proceedings / mediation / arbitration] in [City, State/Province, Country].

12. Miscellaneous

12.1 Entire Agreement.
This Agreement is the entire agreement between the Parties regarding the Subject Matter and replaces all prior oral or written understandings on the same subject.

12.2 Amendments.
Any change to this Agreement must be in writing and signed by both Parties.

12.3 No Waiver.
If a Party does not enforce a right under this Agreement, it does not mean that the Party has waived that right for future situations.

12.4 Severability.
If any provision of this Agreement is found invalid or unenforceable, the remaining provisions shall continue in full force and effect.

12.5 Assignment.
Buyer may not assign or transfer this Agreement without Seller’s written consent. Seller may assign this Agreement in accordance with applicable law, upon written notice to Buyer.

12.6 Counterparts and Electronic Signatures.
This Agreement may be signed in counterparts. Signatures transmitted electronically (including scanned or digital signatures) shall be treated as originals.

13. Signatures

IN WITNESS WHEREOF, the Parties have executed this Installment Payment Agreement as of the Effective Date written above.

Seller / Creditor

Signature: _______________________________
Name: [Authorized Signatory Name]
Title: [Title, if applicable]
Date: [Date]

Buyer / Debtor

Signature: _______________________________
Name: [Authorized Signatory Name]
Title: [Title, if applicable]
Date: [Date]