Demand
for Additional Collateral
_______________________________
_______________________________
_______________________________
DEMAND FOR ADDITIONAL COLLATERAL
Pursuant to the security agreement entered into between
the parties on _____________________, the secured party deems itself insecure,
and demands that you provide additional collateral with a value of $____(______________ & ____/100 dollars)
no later than _________________________. The repayment of the security
agreement may be accelerated if such collateral is not provided by that time.
Dated: ___________________
_______________________________________
__________________________ By Secured Party
Demand
for Additional Collateral
Review
List
This review list is provided to inform you about this
document in question and assist you in its preparation. This Demand for Additional Collateral can
help the creditor improve their security position as well as provide the debtor
more time to repay the loan. This can
radically improve the probability of improving the collection percentage of the
creditor as well. We strongly recommend
taking this approach after payment problems have been incurred but prior to
other court filings.
1.
Make
multiple copies. Send one to the debtor
by mail, another by fax, and keep copies in the related files of the creditor.
2.
In
any settlement and/or court dealings in the future, this good faith step will
be held in favor of the creditor for trying to act in good faith and be
reasonable. Similarly it can be used by
the debtor to avoid extra damage awards (in states such as Massachusetts that
provide them, on occasion, under statutes such as their 93A clause) by their
good intent by providing the collateral additions. However, notwithstanding that, this is
definitely a document that best serves the purposes of the creditor.
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