A debtor and creditor enter into a relationship whereas the debtor is an individual or an entity who has obtained an amount of money from the Creditor who is one who lends an amount of money or is granted the rights to a property as collateral. This relationship is known as a creditor debtor relationship. It is simply defined as a relationship where two parties who enter into an agreement for the borrowing of a monetary amount or something of something of value such as a mortgage or mortgagee relationship in the event of property being land, whereas the debtor is someone creating a debt upon themselves and the creditor is one to whom the money is owed to. There are times that in a relationship of a creditor and debtor such as in a basic loan agreement or agreements with the bank, there arises a dispute such as non-repayment of a debt. In this event, the creditor has general rights over the debtor for the repayment of such a debt. It is beneficial in this event that the creditor and debtor have a contract in place stating the specifics of such a transaction in the event a default occurs, you have proof that such payment has indeed been agreed upon by the parties and have been made.
The essentials to a debtor and creditor relationship should include:
Signed Contract by the debtor and creditor stating specifics of the terms and conditions.
Payment Slips should be kept to prove the payments being made by the debtor to the creditor. Note that both parties should keep the payment slips for avoidance of doubt.
Collateral or Consideration should be made by the debtor so as to have an obligation of payment of the debt and therefore the creditor has collateral for further protection and assurance of repayment of the loan.
Please note, that the listed above isn’t the only areas where our lawyers have experience, we are also involved in to the areas including:
Arbitration (Alternative Dispute Resolutions, ADR) Intellectual
Letter of Credit
Britch of Commercial Agreements
Our team handles a wide range of boundary and easement disputes and represents title companies in sophisticated policy coverage issues;
At Juslaws & Consult we provide a free of charge consultation on the brief matters of litigation in order to provide you with a basic strategy on how you should proceed. Contact us today at our office in Bangkok or in Phuket.