A monthly payment contract is a legally binding agreement between a debtor (the person to whom the money is owed to) and the payer (the person who has to make the monthly payment) regarding the payment that is to be exchanged between the two of them every month. The monthly payment could be a rent or an instalment that is paid every month.
A monthly payment contract needs to have all the details of the debtor and the payer as a primary requirement. The details of the amount and nature of the monthly payment that is to be made is to be included in the contract as well. The period of time for which the payment is to be made,also called as the ‘term’ is to be included in the contract.
Details about the legal action that the debtor would like to take in case the payment is delayed or not done at all is also to be included in the contract. A copy of the contract is to be given to the debtor and the payer and preferably, a witness for as long as the monthly payment is to be done and both the parties should abide by the contract.
Sample Monthly Payment Contract