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A Debt Assumption Agreement lets someone take over another party's debt obligations legally and completely. In Belgian civil law, this three-way contract transfers both the responsibility to repay and all associated terms from the original debtor to a new one, with the creditor's explicit consent.

Belgian businesses often use these agreements during mergers, corporate restructuring, or family wealth transfers. The agreement must comply with Articles 1271-1281 of the Belgian Civil Code governing debt transfers, and it permanently releases the original debtor once signed - unless specifically structured as a joint obligation. Banks and financial institutions typically require additional guarantees when accepting a new debtor.

Use a Debt Assumption Agreement when transferring debt obligations during business restructuring, family succession planning, or corporate acquisitions in Belgium. This agreement becomes essential during mergers where one company takes over another's loan obligations, or when passing business debts between family members in generational transitions.

The agreement proves particularly valuable when Belgian companies need to reorganize their debt structure while maintaining good relationships with creditors. It offers a clean, legally sound way to shift payment responsibilities without disrupting existing credit arrangements. For maximum protection, put this agreement in place before the actual debt transfer occurs, especially when dealing with multiple creditors or complex financial obligations.

• Unconditional Assumption: Complete transfer of debt responsibility to the new debtor, releasing the original debtor entirely from obligations
• Co-Debtor Assumption: New debtor joins the original one, creating shared responsibility for the debt
• Conditional Assumption: Transfer depends on specific triggers or performance metrics being met
• Limited Assumption: New debtor takes over only specific portions of the debt or certain payment obligations
• Temporary Assumption: Debt transfer applies for a defined period, with obligations returning to the original debtor afterward

• Original Debtor: The party seeking to transfer their debt obligations, often a company restructuring or an individual planning succession
• New Debtor: The party taking on the debt responsibilities, must demonstrate financial capacity to Belgian creditors
• Creditor: The bank or financial institution that must explicitly approve the debt transfer under Belgian law
• Corporate Lawyers: Draft and review the agreement to ensure compliance with Belgian Civil Code requirements
• Financial Advisors: Evaluate the financial implications and structure of the debt transfer for all parties
• Notaries: Often required to authenticate the agreement, especially for significant debt transfers or real estate-related obligations

• Original Debt Details: Gather complete loan documentation, including payment terms, interest rates, and outstanding balance
• Financial Assessment: Verify new debtor's financial capacity and creditworthiness through recent bank statements and credit reports
• Creditor Consent: Obtain written approval from all involved creditors before drafting begins
• Party Information: Collect legal names, registration numbers, and authorized signatories for all parties
• Security Details: Document any collateral or guarantees that will transfer with the debt
• Timeline Planning: Establish clear transfer dates and any transitional payment arrangements
• Draft Review: Our platform generates a compliant agreement, ensuring all Belgian legal requirements are met

• Party Identification: Full legal names, addresses, and registration numbers of original debtor, new debtor, and creditor
• Debt Description: Detailed specification of the debt being transferred, including amount, interest rates, and payment terms
• Transfer Terms: Clear statement of debt assumption conditions and effective date
• Creditor Consent: Explicit written approval from creditor as required by Belgian Civil Code
• Original Debtor Release: Terms of discharge from debt obligations
• Governing Law: Specific reference to Belgian law and jurisdiction
• Security Transfer: Details of any collateral or guarantees transferring with the debt
• Signature Block: Space for authorized signatures with date and place of execution

A Debt Assumption Agreement differs significantly from a Debt Settlement Agreement in both purpose and effect under Belgian law. While both deal with debt obligations, they serve distinct functions in financial arrangements.

• Primary Purpose: Debt Assumption transfers existing debt obligations to a new debtor, keeping the original terms intact. Debt Settlement modifies or reduces the debt amount through negotiation with creditors
• Creditor Involvement: Assumption requires explicit creditor approval for the transfer, while Settlement focuses on reaching a compromise on payment terms
• Original Debtor Status: In Assumption, the original debtor is typically fully released from obligations. Settlement keeps the original debtor responsible but under modified terms
• Legal Effect: Assumption maintains the full debt value but changes who pays, while Settlement usually results in partial debt forgiveness or payment restructuring