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A payment plan agreement is established between a debtor and a creditor, outlining the terms for repaying owed money. This approach is often used for expensive items or services, allowing customers to divide costs into manageable payments while providing sellers the opportunity to earn additional revenue through interest. Payment plans are advantageous as they alleviate the immediate financial burden on buyers, making it easier for them to acquire necessary goods or services. These agreements can cover a wide range of purchases, and resources for free templates are available. Ultimately, payment plans benefit both parties by offering flexibility to buyers and potential profit to sellers.