Forbearance Contract (Commercial Property Loan) (Pre-Workout)

The Forbearance Contract (Commercial Property Loan) (Pre-Workout) is a legal template that pertains specifically to commercial property loans under USA law. The document serves as an agreement between a lender and a borrower seeking temporary payment relief or modifications to the terms of their loan agreement in order to avoid default or foreclosure. This contract is typically used during the early stages of financial distress, before an official workout agreement is reached. It outlines the terms and conditions agreed upon by both parties during a forbearance period, whereby the lender agrees to temporarily suspend certain loan obligations, such as principal and interest payments, while the borrower agrees to adhere to a modified repayment plan. The purpose of this template is to establish clear guidelines for the forbearance period, including the duration, actions required by the borrower, and the potential consequences for noncompliance. This legal document ensures that both the lender and borrower agree to the terms and conditions set forth, providing a framework for the ongoing business relationship and a pathway for the borrower to stabilize their financial situation while preventing foreclosure.