How To Write A Loan Agreement Between Two Parties
- Make sure that the purpose of the loan agreement is easy to understand. Because the loan agreement is illegal document, all people who signed the contract should understand the purpose of the letter.
- Whether you are a borrower or lander, do some confirmation like about the personal data and address including phone number or even e-mail. If you do not understand or even feel that the agreement is not correct, never signs it.
- Well since this contract is a loan agreement between two parties, both of them need discuss. Make sure that you understand the contract well. It is okay when you want to discuss about the payment and loan before both of you make a deal.
Loan Agreement Letter Example
Loan Amount___________ Dollars ($____________)
Date _____________, 20_____
For the above value received by ___________________________ with a mailing address of __________________________, City of ___________________________, State of ________________________, (the “Borrower”), agrees to pay ______________, City of __________________________, State of _______________________, (the “Lender”).
This agreement, (the “Note”), shall be due and payable, including the principal and any accrued interest, in one of the following ways:
Once per week beginning on ______________, 20____ and to continue every seven (7) days until the balance is paid.
Once per month beginning on ______________, 20____ and payment is due on the ___ of month until the balance is paid.
All payments made by the Borrower are to be applied first (1st) to any accrued interest and then to the principal balance. The total amount of the loan shall be due and payable on the ___ day of ___________________, 20____.
The Note shall
Bear interest at a rate of _______________________ percent (______%) compounded annually. The rate must be equal to or less than the usury rate in the State of the Borrower.
Not bear interest.
The Borrower has the right to pay back the loan in-full or make additional payments at any time without penalty.
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