Short answer. Yes, most likely. Article 1292 requires that extinguishment be declared in unequivocal terms, or that the old and the new obligations be on every point incompatible with each other. A rescheduled payment plan normally modifies the original obligation rather than replacing it.

What the law says

In order that an obligation may be extinguished by another which substitute the same, it is imperative that it be so declared in unequivocal terms, or that the old and the new obligations be on every point incompatible with each other.

Civil Code, Article 1292 — Express or Implied Novation. Read the full provision →

Novation is never presumed

Article 1292 sets a deliberately high bar: In order that an obligation may be extinguished by another which substitute the same, it is imperative that it be so declared in unequivocal terms, or that the old and the new obligations be on every point incompatible with each other. The word imperative is doing the work. Silence proves nothing, and a creditor's willingness to accept payment on easier terms is not a statement that he has given up the contract he holds. If nobody said the old obligation was extinguished, the starting position is that it was not.

'Incompatible on every point' is a strict phrase

The second limb rescues arrangements that were never written down, but only where the two obligations genuinely cannot coexist. A revised schedule does not meet it. New due dates sit on top of the same principal, owed by the same debtor to the same creditor, secured by the same property, computed at the same rate unless that too was changed. Every element of the original survives except the timing. Where a new arrangement is simply the old debt paid differently, it modifies; where it replaces the subject matter, the parties or the whole basis of the liability, the argument for replacement becomes serious.

What survival means for you

It cuts both ways, which is why the question is worth answering precisely. The original interest rate, the acceleration clause and any penalty continue to apply, so a default on the new schedule usually revives the creditor's full remedies under the old contract rather than confining him to the concession he granted. Equally, whatever protected you continues too — your defences, the original computation of the debt, and any limits the contract placed on charges. Article 1296 explains the flip side: only where the principal obligation is extinguished by novation do accessory obligations fall away, and then only insofar as they benefit non-consenting third persons.

Getting it recorded

Ask for the arrangement in writing, and ask it to say which of the two things it is. A restructuring letter that states whether the original obligation subsists as amended, what the outstanding balance is as of a stated date, and how each payment is to be applied prevents most later disputes. Keep every receipt in the meantime; Article 1253 provides that where the debt produces interest, payment of the principal is not deemed made until the interest has been covered, so a plan that looks like it is reducing the balance may be doing something else.

Cases citing this provision

These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.

Related provisions

Note. Statute text quoted on this page is reproduced from the official enactment and is linked to the full provision. The explanation around it is general legal information from Vivas & Nobles Law Office, not legal advice. Whether it applies to your situation depends on facts only a lawyer reviewing them can assess.