Cession of Book Debts

R 405,00

This Cession of Book Debts Agreement may be used where a debt is owed or may in the future be owed by a debtor, and additional security is required. By signing a Cession of Book Debts contract, the debtor agrees to transfer to the creditor the right to claim money that is owed to the debtor by the debtor’s debtors.

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CESSION OF BOOK DEBTS AGREEMENT

Summary This Cession of Book Debts Agreement may be used where a debt is owed or may in the future be owed by a debtor, and additional security is required. By signing a Cession of Book Debts contract, the debtor agrees to transfer to the creditor the right to claim money that is owed to the debtor by the debtor’s debtors.

Why do I need a Cession of Book Debts? A Cession of Book Debts contract affords you as the creditor additional security. In the event that the debtor defaults in payment, you may use this Cession of Book Debts to claim money that is owing to the debtor, eg. by the debtor’s customers. A Cession of Book Debts agreement is often used as an additional security requirement when a customer applies for a credit facility, before any goods or services are delivered. It can also be used to obtain additional security before lending someone money or goods and equipment.

Also view: Cession and Pledge of Goods

What type of business should use a Cession of Book Debts Agreement? If your business has debtors that owe money, or there is a high likelihood that they will in the future owe money, then this Cession of Book Debts undertaking may be considered to reduce your risk in the debtor defaulting.

What does the Contract of Cession of Book Debts look like? The Cession contract template can be printed onto two pages.

What do you need to do to use the Cession of Book Debts?

  • Read the template cession agreement document to ensure that it suits your requirements. Make changes as required.
  • Complete the relevant details, and get the debtor to sign.
  • A Cession of Book Debts contract is usually obtained at the beginning of the business relationship, or during the application stage, and before any goods / services / loan is delivered. But it can also be used to obtain additional security from a debtor who owes money.

If the transaction is subject to the National Credit Act 34 of 2005 then we recommend that specialist advice be obtained.

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