Uploaded by: Marilyn Vargas at February 13 2018 19:53:43.
While mentioned in brief earlier, a free loan agreement template is a legal document. It must contain specific information in clear, legal language. In the event the lender or borrow decides to pursue legal action, a simple loan agreement must have correct and clear information. It will make all the difference when you take your dispute before a judge in a court of law. Every personal loan agreement template or alternative loan contract template has “must have” information in the document.
Any provisions that apply to the loan are also something the document includes. The form is to ensure that both the borrower and lender agree to the terms and provisions. Once the borrower, lender, and a witness document the form it is a legal and binding agreement. When loaning money, if you want to ensure repayment, use the personal loan agreement. With the provisions in the document the regulations are clear. After signing it, the borrower or the lender cannot make changes to the initial agreement.
When you are looking for a quality free loan agreement template, it is your responsibility to ensure the paper contains all the following pertinent information: (1). The current date of the document: It should match the date the borrower, lender, and witness sign the document or the date should be a bit earlier than the signatures date. (2). Information on the lender: The name, address, and contact information of the borrower. (3). Information on the borrower: The name, address, and contact information of the lender. (4). Loan principle details: The amount of the principle of the loan (the funds less the compounded interest). (5). Interest facts: The conditions of the interest and how it applies to the principle. This includes the rate of interest as well as if the borrower must pay off the interest first before the principle. (6). The conditions of loan use: The lender retains the right to define how the borrow uses the funds and for what purpose. (7). How the borrower pays back the funds: The options for loan repayment. (8). Clear loan terms: The term length and duration. (9). Collateral terms: The free loan agreement template should explain any kind of collateral the to which the borrower and lender agree. (10). Cancellation options: The terms the lender agrees to allow the cancellation of the loan. (11). Early payoff opportunities: Early repayment terms and if there is a penalty for repayment. (12). In the event of default: The terms of what happens if the borrower defaults on the payments. The actions the borrower will take if the borrower does not pay back all the principle and interest.
What, exactly, was the amount of the money owed? Most importantly, a loan agreement makes it clear that the money given was, in fact, a loan – and not a gift. Also, it tidies up the loan by setting out payment requirements. Is the loan to be paid back in installments, or all by a certain date? Is there any interest being charged on the loan, or late charges if the loan is not paid back?
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