Loan Agreement Template

Loan Agreement
Dated: __________
__________
FOR VALUE RECEIVED, the undersigned, __________ (the "Borrower"),

located at __________, __________, __________ __________, hereby
promises to pay to the order of __________, (the "Lender"), located at
__________, __________, __________ __________, the principal sum of
__________ together with interest on the principal balance, and in accordance
with the terms set forth below.
Payment. The principal amount of this Loan together with accrued and unpaid
interest and all other charges, costs and expenses, is due and payable on or
before __________. All payments under this Agreement are applied first to
accrued interest and then to the balance of the outstanding principal.
Prepayment. The Borrower has the right to prepay all or any part of the principal
amount of this Loan, together with accrued and unpaid interest thereon, at any
time without prepayment penalty or premium of any kind.
Costs and Fees. In the event of default, the Borrower shall pay to the Lender all
costs of collection including reasonable attorney's fees.
Waiver. The Borrower and all sureties, guarantors and endorsers hereof, waive
presentment, protest and demand, notice of protest, demand and dishonor and
nonpayment of this Loan.
Successors and Assigns. This Loan will inure to the benefit of and be binding

on the respective successors and permitted assigns of the Borrower. The
Borrower may not assign its rights or delegate its duties under this Loan without
the Lender’s prior written consent.
Joint and Several Liability. If there is more than one Borrower of this Loan, the
obligation of each Borrower shall be joint and several under this Loan.
Amendment. This Loan may be amended or modified only by a written

agreement signed by the Borrower and Lender.
Severability. In the event that any of the provisions of this Loan are held to be
invalid or unenforceable in whole or in part, the remaining provisions shall not be
affected and shall continue to be valid and enforceable as though the invalid or
unenforceable parts had not been included in this Loan.
Loan Agreement (Rev. 1339ED7) 1/5

Notifications. Any notice or communication under this Loan must be in writing
and sent via one of the following options:
Governing Law. This Loan shall be governed by and construed in accordance

with the laws of __________.
IN WITNESS WHEREOF, the undersigned has executed this Loan Agreement
as of the date first stated above.
________________________________________
Signature of Borrower

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Loan Agreement (Rev. 1339ED7)
GENERAL INSTRUCTIONS
If you are on either end of a loan, you should consider - If you borrow money from an individual lender or a
creating a Loan Agreement to document the loan business and you want to document the terms and
transaction. Before doing so, you may want to find out conditions of the loan in writing.
more information about what a Loan Agreement is and - If you plan to loan any amount of money to another
what it can do for you. individual or entity and you want to create a formal record
of the transaction and specify the terms of repayment.
WHAT IS A LOAN AGREEMENT? - If you are either the borrower or lender in a loan
transaction which involves interest on the principal
A Loan Agreement is a written contract between two amount of the loan.
parties — a lender and a borrower — that can be - If you are either the borrower or lender and want
enforced in court if one party does not hold up their end of a written record defining the loan repayment schedule.
the bargain.
SITUATIONS IN WHICH A LOAN AGREEMENT IS
COMMONLY USED
The borrower understands that the money being
borrowed will be repaid to the lender at a future date and
possibly with interest. Similarly, the lender cannot change - Private or personal lending between friends, family
their mind and decide to not lend the borrower money, members, neighbors or colleagues.
especially if the borrower relies on that promise and - Down payments on property
makes a purchase with the expectation that they will - Mortgages or real estate loans
receive money soon. - Student or educational loans
- Commercial or business loans
- Loans for car or vehicle purchases
A Loan Agreement protects the rights of both the
borrower and the lender. Reducing the terms In addition to the situations listed above, there are many
and conditions to writing helps make the parties address other circumstances in which a Loan Agreement would be
and discuss the important terms of the loan transaction useful and appropriate.
ensuring that they are clear and fair to both parties. The
document can prevent the lender from taking advantage WHAT TO INCLUDE
of the borrower in relation to the repayment of the loan
and it can serve to protect the money loaned by the When creating a Loan Agreement, it is important to
lender. include certain information. To make sure the document
is complete, you should include the following:
While the existence of the Loan Agreement itself does not - Full details of the lender including the name and
necessarily guarantee that the borrower will repay the address
money back in a timely manner, the presence of such a - Full details of the borrower including the name and
document can help to support the lender's claim if legal address
action has to be taken to reclaim any money. At a - Principal amount of the loan
minimum, the parties have a written agreement - Any interest accrued on the loan and the rate of interest
evidencing that a loan has taken place. - Repayment options
- Repayment schedule
WHEN SHOULD ONE BE USED? - Any additional stipulations relating to the loan such as
prepayment or default of the loan
There are a number of different scenarios in which a Loan REPAYMENT OPTIONS

Agreement should be used. If any of the following
circumstances apply, you should consider using a Loan The Loan Agreement should clearly set out the
Agreement to protect your interests: repayment schedule so that there is no question as to
how and when the borrower must repay the principal
- If you borrow money from an individual lender or a amount of the loan and interest (if applicable) to the
business and you want to document the terms and lender. The most common types of repayment options are
conditions of the loan in writing. lump sum payments, installment payments and "due on
- If you plan to loan any amount of money to another demand" payments.
individual or entity and you want to create a formal record
of the transaction and specify the terms of repayment.

Loan Agreement (Rev. 1339ED7)

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Loan Agreement

FOR VALUE RECEIVED, the undersigned, __________ (the "Borrower"),

Successors and Assigns. This Loan will inure to the benefit of and be binding

Amendment. This Loan may be amended or modified only by a written

Loan Agreement (Rev. 1339ED7) 1/5

Governing Law. This Loan shall be governed by and construed in accordance

Loan Agreement (Rev. 1339ED7) 2/5

Loan Agreement (Rev. 1339ED7) 3/5

There are a number of different scenarios in which a Loan REPAYMENT OPTIONS

Loan Agreement (Rev. 1339ED7) 4/5

Loan Agreement (Rev. 1339ED7) 5/5

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