When there is payment between two entities, it is very important that a letter of agreement for payment is written. So, every employee ought to know how to draft a payment agreement letter between two parties. There is a sample payment agreement letter available in this page. Such letters are evidences for payment and when one of the parties fails to fulfill any deals made, this letter can be evoked for legal action.
A letter of agreement for payment of debt is a binding contract or promise made by the borrower to the lender for paying the debt. Such letters are widely used in the private sectors. An agreement letter between two parties for lending money is not only written between businesses but also better friends, relatives etc.
Tips to focus while writing payment agreement letter
While writing such letters it is mandatory that both parties understand the agreement made very clearly to avoid any confusion.
Firstly, overlook a sample: the first and foremost thing you need to do is to go through a sample letter of such a kind. Every industry has different norms for such letter and hence important for you to write according to the industry you work for.
Quirky title: its important to add a unique title to your letter. It might sound silly, but make sure you add one. Write the title, make it bold and align it at the center. Be sure it stands uniquely.
Schedule for payment: the schedule regarding payment should be fixed. It should be mentioned in the letter. All details like when payment was made and how it is to be repaid should be included.
Charges for being late: if there are charges for late payment, then it should be included in the agreement without fail. It is a very important point to be added in such letters.
Mode of payment: you can take the liberty to mention how the payment is to be made. It could be via credit cards, net banking, cheques or as cash.
Download Simple Letter of Agreement for Payment between Two Parties Sample
Format for writing payment agreement letter:
If you really want to be professional in writing such letters, then you need to know the format of such a letter. All these kinds of letters are formal letters and hence, it follows the format of a formal letter.
Start off with the sender’s address and other contact details like name etc. Go ahead and write the date of drafting the letter on the next line. Followed by it is the receiver’s address and contact details of the receiver.
Give a proper salutation and write a crisp subject. Remember a subject should not be more than one line and should convey the purpose. Now continue and write the body of the subject which contains all the above said details like payment date, method, repayment strategy etc.
End the letter with regards followed by signature and name. Check out Letter of Acknowledgement of Receipt.
All letters like these need to be written with the at most care. Attention to detail is very important as any error made could lead to even legal issues. So be sure that the letter is written very correctly and in a very professional manner. Always take time to recheck what is written. Make corrections where ever necessary. Have a proper plan and a rough draft before you write such a letter. Planning is the key factor for a perfect letter. Check out Letter category.