Loan Agreement Templates: Finding the Right One
A loan agreement is an agreement between two parties that outlines the stipulations of a loan and its repayment terms. Writing up a loan agreement is an important measure to take when taking out or giving a loan because they legally bind both parties to the agreement. Having a clearly written loan agreement between you and the party you are lending to or borrowing from that clearly outlines the details of the agreement will help you avoid trouble or misunderstandings that can commonly arise.
When you’re drafting your loan agreement, you’ll want to make sure you use all the right words and phrases to cover all of your bases and outline the loan in a clear, fair and legally accurate way. There are many loan templates available to help you get started, but which ones are best and what are the differences between them all? Here are a few loan agreement templates that will help you get started drafting the right agreement for your loan.
Personal Loan Template
Buzzle offers a great personal loan template and less sophisticated language to help you outline a loan to a friend or peer. It’s very cut and dry and allows you to modify it to your needs, but is best used for small amounts of money between friends or acquaintances.
Small Business or Startup Template
This straightforward loan agreement template is a great example of a simple contract for a small business or startup. It includes 11 clauses that cover everything from the breakdown of the loan to interest charges, warranties and provisions and is an easy and uncomplicated way to structure the terms of your loan.
More Complex Loan Templates
This site provides three different examples of loan templates. The first is very basic and straightforward, simply stating the terms of the loan without a lot of legal jargon. The next two are more complex. At 14 and 23 pages, they cover a lot of territory. More complex loan agreements are necessary for different reasons. If there are a lot of different stipulations about your loan, such as the amount it will mature and the time it might take to pay it off, you will need to include more clauses and provisions. If you are dealing with a very complicated loan, it might be worth it to seek legal advice to make sure you are not leaving out any information that could lead to trouble in the future.
Credit Union Loan Template
This is a loan agreement between a credit union and a borrower and might be helpful for people who are loaning money from a business to business or business to an individual.
Short Form Loan Agreement Template
This is a short form loan agreement that outlines the loan in basic language and also includes optional language to allow you to customize it in more depth if you need to.
Revolving subordinated Loan Template
This is an example of a revolving subordinated loan agreement, which typically takes place between a broker and an officer, stockholder or partner. It has specific language to outline the relationship between the two parties and also has a schedule of payables included at the end.
Basically, when you’re deciding how to write a loan agreement, here are the main things you want to keep in mind: the interest rate, the payment schedule and additional information about late payment fees, what should happen if the borrower defaults and what should happen if the borrower pays off the loan before schedule. By keeping these in mind and using a well-written template, you should be able to draft your own detailed loan agreement.