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Forbearance Agreement Loan Template for Ireland

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Key Requirements PROMPT example:

Forbearance Agreement Loan

"I need a Forbearance Agreement Loan under Irish law for a corporate borrower with multiple commercial property loans totaling €5.2M, where we're agreeing to a 12-month payment reduction and interest rate adjustment starting March 2025, with quarterly financial reporting requirements."

Document background
The Forbearance Agreement Loan is a crucial document in Irish lending practice, typically employed when borrowers face genuine financial hardship and require modifications to their existing loan terms. This document type has gained particular significance following financial crises and economic challenges, where both institutional and individual borrowers may need payment relief or loan restructuring. The agreement must carefully balance the lender's risk management requirements with borrower protection measures mandated by Irish law and Central Bank regulations. It includes detailed terms about the nature of the forbearance (such as payment holidays, interest rate adjustments, or term extensions), conditions for maintaining the arrangement, and consequences of default. The document is essential for compliance with Irish regulatory requirements, including the Code of Conduct on Mortgage Arrears and Consumer Protection Code where applicable, and serves as a legally binding modification to the original loan agreement.
Suggested Sections

1. Parties: Identification of the lender and borrower(s), including full legal names and addresses

2. Background: Recitals detailing the original loan agreement, current status, and reason for forbearance

3. Definitions: Definitions of key terms used throughout the agreement, including references to the original loan agreement

4. Acknowledgment of Debt: Confirmation of the current outstanding amount and acknowledgment of the existing defaults

5. Forbearance Terms: Details of the modified payment terms, including payment amounts, schedule, and duration of the forbearance period

6. Conditions Precedent: Conditions that must be satisfied before the forbearance arrangement becomes effective

7. Borrower's Representations and Warranties: Current financial status declarations and confirmation of information accuracy

8. Continuing Obligations: Ongoing requirements the borrower must meet during the forbearance period

9. Default Provisions: Circumstances that would terminate the forbearance arrangement and consequences of breach

10. Reservation of Rights: Lender's preservation of rights under the original loan agreement

11. Governing Law and Jurisdiction: Confirmation of Irish law governance and jurisdiction

Optional Sections

1. Additional Security: Include when new security is being provided as part of the forbearance arrangement

2. Guarantor Provisions: Required when the original loan has guarantors who need to consent to the forbearance

3. Insurance Requirements: Include when specific insurance obligations are part of the forbearance conditions

4. Financial Covenants: Add for commercial loans where ongoing financial performance metrics need to be maintained

5. Reporting Requirements: Include for cases requiring regular financial or operational reporting

6. Release Provisions: Include when certain obligations or parties are being released as part of the arrangement

7. Tax Provisions: Required when there are specific tax implications that need to be addressed

8. Fees and Costs: Include when there are specific fees or costs associated with the forbearance arrangement

Suggested Schedules

1. Schedule 1 - Original Loan Details: Summary of the original loan agreement terms and amendments to date

2. Schedule 2 - Modified Payment Schedule: Detailed schedule of revised payment amounts and dates

3. Schedule 3 - Current Debt Statement: Breakdown of current outstanding principal, interest, and any fees or charges

4. Schedule 4 - Conditions Precedent Documents: List of documents and conditions required before effectiveness

5. Schedule 5 - Required Forms: Standard forms required by Irish regulatory requirements

6. Appendix A - Compliance Certificate: Template for ongoing compliance certification if required

7. Appendix B - Notice Requirements: Mandatory warnings and notices required under Irish consumer protection laws

8. Appendix C - Direct Debit Mandate: New payment instructions and authorizations if applicable

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions



















































Clauses



































Relevant Industries

Banking and Financial Services

Real Estate and Property

Commercial Lending

Retail Banking

Agricultural Finance

Corporate Finance

Asset Finance

Construction and Development

Manufacturing

Small and Medium Enterprises (SMEs)

Relevant Teams

Legal

Credit Risk

Compliance

Loan Operations

Corporate Banking

Retail Banking

Special Assets

Collections and Recovery

Risk Management

Financial Control

Regulatory Affairs

Customer Relations

Relevant Roles

Credit Manager

Loan Officer

Risk Manager

Compliance Officer

Legal Counsel

Debt Restructuring Specialist

Collections Manager

Relationship Manager

Credit Risk Analyst

Financial Controller

Managing Director

Chief Financial Officer

Corporate Banking Manager

Retail Banking Manager

Regulatory Compliance Manager

Recovery and Restructuring Manager

Industries










Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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