An installment agreement is a document devised against a legal background wherein one company authorizes another company to deliver products or services in a series. The payments are also made in a line generally. The entire payment scheme is thus punctuated by specific dates of delivery and performances. These dates may be previously fixed or targeted on the fulfillment of certain conditions depending on the contract rule. The installments may be broken down into weekly, monthly, quarterly or even annual plans conditional on the scale of the agreement. If the agreement entails long service packages and huge sums of money, the installment amounts may be distributed over a longer span of time if not it is increased for all the installment periods.
As it is evident, obstruction or failure to pay one or more installments would lead to legal consideration of the situation since it would be then assessed in terms of the degree of damage and financial loss of the company. The expectant fallout is cancellation of the agreement or penalty charges on the breaching company.
This plan may be liberally applied to tax payment in United States when the payers are unable to pay the taxes in full. The due payments should be cleared every month on time in order to avoid paying the setting-up and penalty fee. For that, the payer must know the maximum amount he is financially capable to pay within the given date. Or else he may be subjected to the extra payments generating undue complications.
The installment agreement has the following advantages as its forte:
- The company is free to make the payments as and when convenient which reduces a lot of the burden imposed on it.
- The services are rendered slowly with ease over a length of time that keeps the quality of the service under check.
- Such an attempt strengthens the relationship between the respective companies and adds a personal touch to the professional agreement.
The following aspects should be given importance while generating an installment agreement:
- The name and contact data of the party must be given lucidly for valid proceedings of the agreement.
- The date of starting and ending of the installment scheme must be provided in clear terms.
- The payment amount, pattern and means must be given out in detail to which the conforming company must agree completely.
- The agreement’s legal conditions must be elaborately given for maximum transparency.