Letter agreeing to extend a debt repayment deadline
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What's a letter agreeing to extend a debt repayment deadline, and when do you need it?
You should use this letter if your business is owed a debt by another business and you intend to agree an extended payment arrangement, e.g. the repayment of sums that are immediately owed to you over an agreed period of time.
On its own, this letter is not a legally binding agreement on you. This is because an agreement to accept the payment of a debt that is already due is not legally binding unless it is supported by additional new terms.
So, this letter is most appropriate where you and your debtor have already agreed what’s acceptable to you and you now want to record in writing your intention to accept the proposed repayment terms. It’s highly advisable to record your agreement in writing.