Workout Agreement

A Workout Agreement is a legal document used in financial contexts, particularly in loan restructuring. It outlines terms between a borrower and lender when the borrower is struggling to meet their debt obligations. The agreement typically includes details like adjusted payment schedules, reduced interest rates, or debt forgiveness. Its purpose is to provide a mutually beneficial way for borrowers to manage their debts and for lenders to recover funds without resorting to bankruptcy or foreclosure. Essentially, it's a negotiated plan to help both parties navigate financial difficulties collaboratively.