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Debt Resolution Agreement for New Zealand

Debt Resolution Agreement Template for New Zealand

A comprehensive legal document governed by New Zealand law that formalizes an agreement between a creditor and debtor regarding the resolution of outstanding debt. The agreement sets out specific terms for debt repayment, including payment schedules, interest arrangements, and consequences of default, while ensuring compliance with New Zealand's Credit Contracts and Consumer Finance Act 2003 and related legislation. It provides legal protection for both parties and establishes a clear framework for debt resolution, including provisions for monitoring, reporting, and dispute resolution.

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What is a Debt Resolution Agreement?

The Debt Resolution Agreement is a crucial document used in New Zealand when parties seek to formally structure the repayment of outstanding debt. It's particularly valuable when standard payment terms need to be modified or when establishing a formal payment plan for substantial debts. The agreement must comply with New Zealand's legal framework, including the Credit Contracts and Consumer Finance Act 2003, Fair Trading Act 1986, and relevant financial services regulations. This document is essential for businesses and individuals seeking to resolve debt issues while maintaining legal compliance and protecting both creditor and debtor interests. It typically includes detailed payment schedules, interest calculations, default provisions, and may incorporate security arrangements or guarantor provisions where applicable.

What sections should be included in a Debt Resolution Agreement?

1. Parties: Identifies the creditor and debtor with full legal names and addresses

2. Background: Outlines the existence of the debt, its origin, and the parties' intention to enter into a resolution arrangement

3. Definitions: Defines key terms used throughout the agreement

4. Acknowledgment of Debt: Formal acknowledgment of the debt amount and its validity

5. Payment Terms: Details of the agreed payment plan including amounts, frequency, and payment methods

6. Interest and Fees: Specifies any ongoing interest charges or fees applicable to the debt

7. Default Provisions: Consequences and remedies in case of payment default

8. General Obligations: Ongoing obligations of both parties during the debt resolution period

9. Termination: Circumstances under which the agreement can be terminated

10. Dispute Resolution: Process for resolving any disputes that arise

11. General Provisions: Standard contract clauses including governing law, notices, and amendments

12. Execution: Signature blocks and execution details

What sections are optional to include in a Debt Resolution Agreement?

1. Security Arrangements: Include when specific assets are provided as security for the debt

2. Guarantor Provisions: Required when a third party is guaranteeing the debt

3. Credit Reporting: Include when there are specific agreements about credit reporting during the resolution period

4. Debt Write-Off: Include when part of the debt will be written off upon completion of the payment plan

5. Early Payment Provisions: Include when there are specific terms for early payment or debt settlement

6. Third Party Payments: Include when payments will be made by or through third parties

7. Debt Assignment: Include when there's possibility of debt assignment to other parties

What schedules should be included in a Debt Resolution Agreement?

1. Schedule 1 - Debt Details: Detailed breakdown of the debt including principal, interest, fees, and charges

2. Schedule 2 - Payment Schedule: Detailed payment plan showing dates, amounts, and running balance

3. Schedule 3 - Security Details: Description of any security assets and their current valuation

4. Appendix A - Supporting Documents: List of relevant documents evidencing the original debt

5. Appendix B - Direct Debit Authority: Direct debit setup forms if applicable

6. Appendix C - Guarantor Documents: Guarantor identification and acknowledgment forms if applicable

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

New Zealand

Cost

Free to use

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