Payment Plan for SC

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    Payment Plan for SC

    One of our leaseholders has agreed to settle their SC via monthly payments.
    I want to make it formal and for them to sign a payment plan agreement.

    Any wording I should include and has anyone got a template?

    Its normally paid by "bank standing order form " on which you may ask for 12 monthly payments from leaseholders bank account to your RTM Bank account e.g first payment of £130 on 25 March or 1st April followed by 11 monthly payments of £100 .

    Get a blank SO form from his bank , enter your details and ask him to sign and hand into his branch .

    Local Councils use this method to collect your Council Tax over 10 months.


      Originally posted by Carine View Post
      One of our leaseholders has agreed to settle their SC via monthly payments.

      From your wording here, are they paying off arrears, or the service charge current demands ?

      You need something in writing.
      Suggest this be a once only agreement..

      You need a Company letter stating that
      "In this instance", regarding service charges payable between
      ( for example ), 1st April 2016 to 31st March 2017, you will allow Mr/mrs xx of flat number xx to repay this debt / forthcoming charges ( ______ delete as required ) owing to xyz company via 12 equal monthly payments starting

      start date ..............
      end date ...............

      Should payment not be completed on the x of each date as shown at the start date and continue each month on the x day of each month, we reserve the right to demand full payment of outstanding debt / future service charges immediately.

      ( If this is for arrears ) state :-
      This concession to repay the arrears only applies to the arrears of any unpaid demanded payments, and not to any future Service charges demanded.

      A signature is not required as your company have set out how to pay the arrears, and if not paid, you may go to the Courts to get that payment. in FULL.

      Remember that RTM's like yours will not have any spare cash, therefore if people don't pay their service charges in advance, then there wont be enough money to start the very last few jobs on the service charge demand as itemised, until 13 months after the service charge demands, which really, should be unacceptable.
      You give your service charge demands for the forthcoming financial year, and you wont be able to complete those jobs within the year, as all money from all leaseholders will not have been received until the very last month of the financial year.

      Waiting for 12 months for all the money to come in is no way to run an R.T.M. company.
      You run a company that has no money of it's own, and you only "hold the leaseholders money on trust"

      The property requires maintenance now, not in 12 months time.

      Lets assume the is no maintenance at all required in one year, and there is only the block insurance to pay for.
      If service charges are all to be paid monthly, you cant insure the building till every penny comes in -- a dangerous position to be in.

      Sorry for the rambling, but it's important to look at for the future of your company.


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