Assignment of Debt can be defined as assignment of the your (debtor) debt payment to the third party, known as Assignee (transferee), by the Creditor (transferor), whom you owe the payment. Once the process of Assigning of Debt to third party has been completed then, the debtor would be notified about the assignment. The creditor is exempted from the liability of collecting payments directly through the debtor, and debtor also makes the payment to assignee, owned by him to the creditor.
The Assignment of Debt can be carried out by the Creditor, as Assignee may have bought the debt of the debtor or Assignor may assign a Collection Agency to recover his debt. The Assignment Notice is also sent to the debtor, making him aware of the Assignment and to make payment to Assignee.
But, it is also necessary to understand, what exactly Assignment means in legal term. Legally Assignment is carried out for transferring right or ownership by the Assignor (transferor) to the Assignee (transferee). For example, you (debtor) owe $1000 to B and liable to pay the due amount to B on specific date. But, B (Assignor/Creditor)) assigns your debt to C (Assignee/transferee) through, Assignment of Debt. Now, it is your duty to pay the debt to C (Assignee), instead of B (Creditor). The Assignee also has the right to collect the debt from you. You also get the Notice of Assignment of Debt from B, to make the payments to C (Assignee).
The Assignment (Ownership/Right) transfer is carried out in different field by various people, such as Rent by the landlord, Debt by the Creditor, Mortgage by the creditor, Writing Works by the Author, Musical Works by the Music Composer and so on. Once, the right is transferred by the Assignor (transferor), the Assignee (transferee) becomes the rightful owner of the right transferred.
Below given Assignment of Debt template, would help you in making your own document for Debt Assignment to the third party. You can also send this Assignment Notice to the debtor, who owes you money, to make the payments to the Assignee.
Debt Assignment template
To: _________________________ (Debtor)
You are hereby notified that ________________ [Creditor] has sold and transferred to
the undersigned all rights to its claim against you in the amount of $______________
You are further notified to direct all payments to the undersigned to insure credit for payment.
Name (Assignee)__________________
Address
___________________________
___________________________
2nd Template
Mr. ______________, S/o _______________, R/o_________________ (Owner of Debt)
I, the undersigned hereby give you notice that by an instrument in writing dated the____________200xx,
I have assigned to Mr.______________, S/o_________________, R/o____________, to collect the debt due to me from you under the
bond executed
by you in my favor with interest already accrued and to accrue on the said amount.
Sd/-___________________