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Examples :: Business Letters :: Extension of time for payment-declined

Extension of time for payment (declined)

Sometimes you can't approve an extension of time. The reasons may be a pattern of default, a bad risk situation, or whatever, but you're not willing to extend the period of time.

There are legal considerations in this situation.

You should seek legal advice regarding circumstances where your requirement for payment may be disputed.

The basic business issues need to be considered carefully, too. If a person is in arrears, but intends to pay, declining a request for extension of payment may be a wrong decision.

Nevertheless, in a situation where you must decline an extension of time, you need to state the basis of the decision to clarify your position to the client.

This can be done tactfully, without creating an impasse for further negotiation.

The example below is based on declining an unacceptable proposal for extension of time for payment. The reason for declining the proposal is spelled out, and an alternative timeframe is suggested clearly.



Your reference
Our reference


Proposed extension of time for payment on account

I refer to your phone call / letter / email concerning a proposal for extension of time for payment of your outstanding account.

This proposal has been considered carefully, and I regret to inform you the proposed terms are not acceptable, due to the four year timeframe.

Please note:

In view of the circumstances you have described, we appreciate that this situation may be very difficult for you to manage.

Accordingly we will grant you a period of one month to make an alternative proposal for terms of payment.

After that period the current terms of payment will be considered to be in force.

Please be advised we will consider any proposal for payment of arrears within a two year timeframe.

If you wish to discuss options in this matter, please contact me directly on the above phone number or email.

Yours sincerely



Please note:

  • This text is intended for advisory and guideline purposes only.
  • Any business letter can become a legal document, so check your content properly before issuing.
  • Any executable or statutorily defined document should be checked for compliance with legal requirements, and you should seek legal advice regarding its contents.