Debt Suspension Agreement Law and Legal Definition

According to 12 CFR 37.2 [Title 12 -- Banks and Banking; Chapter I -Comptroller of the Currency, Department of the Treasury; Part 37 -- Debt Cancellation Contracts and Debt Suspension Agreements] debt suspension agreement means “a loan term or contractual arrangement modifying loan terms under which a bank agrees to suspend all or part of a customer's obligation to repay an extension of credit from that bank upon the occurrence of a specified event. The agreement may be separate from or a part of other loan documents. The term debt suspension agreement does not include loan payment deferral arrangements in which the triggering event is the borrower's unilateral election to defer repayment, or the bank's unilateral decision to allow a deferral of repayment.”