How do you create a sample payment plan?


Quick Answer

Create a sample payment plan by developing a document with placeholders for key factors such as the total amount due, the installment period, payment frequency and the final due date along with the name of the party making the payments. It should also explain the presence of any interest on the payments, the penalties for late payments and any other relevant details.

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Full Answer

A payment plan allows a customer or client to settle a debt to the company through a series of several installments spread out over time, pursuant to the terms of an official contract agreement. When a business creates a sample payment plan, it typically drafts up the contract as it would with a client, only leaving blank spaces or other placeholders in key areas to allow for future customization. The agreement needs to include a section to identify the party responsible for making the payments in order to assign legal liability, as well as the total amount due over the course of the contract.

The plan also needs to outline the frequency of installment payments, such as monthly or ever two weeks, as well as the minimum payment amount due at that time. If the plan includes interest, an additional charge for the ability to pay in installments, the document needs to outline the interest rate and amount. It must also explain the final due date for payments and the consequences for violating any terms of the agreement.

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