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A payment plan agreement is a contract between a debtor and a creditor, outlining the terms for repaying a debt. Payment plans are commonly used for expensive items or services, benefiting both parties. They alleviate the upfront financial burden for the buyer by spreading costs over time, while sellers can earn more through interest charges. Although payment plans can be utilized for various goods and services, they are particularly popular for high-cost purchases. This approach helps buyers acquire needed items promptly while ensuring that sellers receive payment that may exceed the original sale price due to interest. Free templates for payment agreements can be found online.