Loan agreement template is a sample loan contract that defines the terms and conditions of loan arrangement between two parties. A professional sample loan agreement can help both business and individuals to handle their deals on personal loan or complicated business loans.
Loan Agreement Overview
Loan agreement need to specify the terms and conditions of loan in written form, although there is no requirement to do so from legal perspectives in some countries. If you are in the business of loaning money to people, you need to protect yourself by having a loan contract. Depending on the types of loans, the loan agreement can be complex if you are managing business loans.
Loan agreement need to clearly state the entities involved in the loan arrangement. The loan contract is the most critical document of the loan process. It describes what the roles and responsibilities of parties once the contract is signed. It is crucial to state everyone involved in the loan. This means the lender, the borrower or borrowers, any witnesses and if possible an independent third party such a Notary.
Loan Agreement Template
There are free sample loan agreements you can download for reference, however, you may choose to create your own sample agreement. During the process, you need to consider loan agreement format, style and key elements.
The first key part in loan agreement template is the details of parties. In the section, you may state: Borrower (Full Name) :__; Lender (Full Name) : ___; In accordance with the related laws, through the negotiation, both of the parties reach agreement on concluding this contract. You may also include details such as address, telephone etc.
The second key part in loan agreement sample is the details of loan. In the section, you may include: Loan Type: ___; Loan Use: ___ ; The currency and amount of the loan___; Loan Period __; The interest rate of loan___; The interest rate of loan is based on the Floating Interest Rate or fixed interest rate. The loan interest rate is based on____{c43cc04e4081308258812b32decf70ceaaf2af688629143dba36db499cfb14cb}____(upper/lower)to the benchmark interest rate, the yearly executing interest rate is ___{c43cc04e4081308258812b32decf70ceaaf2af688629143dba36db499cfb14cb}; Interest Settlement: All the loan of this contract will base on ______(month/season)to do the interest settlement, the interest settlement day is the 20th of every______(month/last month of every season). the borrower must pay the interest on every interest settlement day. If the last loan principal pay back day is not the interest settlement day, then the unpaid interest needs to be paid with principal together.
The last key part in loan agreement example is the rights and obligations of both lender and borrowers. In the section, you may include: The right and obligation of the lender is as follows, for example, the lender has the right to understand the status of production management, financial activities, material inventory, and the loan using, it can demand the borrower to periodically provide the financial statement and such kind of document, data and information.