Loan agreements are essentially a legal agreement between a borrower and a loan provider

Allow me to share with you these 15 Free Loan Agreement Templates in MS Word to help you prepare and print your very own Loan Agreement quickly.

In this legal agreement, the borrower pledges to pay back the loan on a given schedule or in accordance with some periodic payment schedule. As a loan provider, this legal document is extremely useful as it legally binds the borrower to pay back the loan. For instance, you have to avoid using any template which may be either not accurate or template with incomplete information.

It is advisable to check several sources before selecting the loan agreement templates. There are many online sites that offer such templates for free and other sites that charge a small fee to provide such services. After selecting few of such sources, you can try to find out the details of the different types of loan agreement templates available.

Loan agreement templates have different formats. Some use plain text documents, while others may use proprietary formatting. These templates may also have different number of pages. There are also loan agreement templates that use tabular display format while some may use a grid format.

All these aspects have an impact on the final product. For instance, if the loan repayment terms are short and non-complex, the borrower may find it difficult to understand the complete format and use it without any issues. Thus, a good template should contain several columns for the following details. First, the loan amount, interest rates, the term of the loan agreement and the due date of the loan repayment. Second, the repayment schedules i.e. the date by which the payment should be made and the method of payment should also be indicated in the document.

If a lender insists on doing so, then a case of breach of contract can be lodged against the borrower

On many loan agreements, there is mention of the terms and conditions like balloon amount and default period mentioned in the document. It is advisable not to ignore such terms. The terms and conditions should be clarified so that the borrower knows what he is getting into. This is to avoid any kind of misunderstanding at a later stage. Similarly, it is advisable to be careful about the wordings used in the document.

The most important detail that should be mentioned in a loan agreement is the flexibility of the repayment option of the borrower. A lender cannot force the borrower into a particular repayment plan. Borrowers should also not be pressurized into making a decision. It is the prerogative of the lender to decide the terms of repayment.

At times, borrowers prefer to make extra payments in advance to reduce the amount of interest rate and thus lower their monthly installments. However, a lender cannot insist on making such payments.

However, while preparing loan agreement template, it is important to follow certain guidelines to make the process less tedious and error free

Another important aspect that is to be kept in mind while writing loan agreements is the clause of assignment of the contract. This clause is considered very important because the assignment of the loan to the lender can be done only after the latter has paid all the dues and interests to the former. Sometimes, when the terms of a particular loan are mentioned in the agreement, it ount of the loan taken. This is because different types of loans have different clauses. Hence, it is essential to be very clear and precise in describing the terms and conditions in the loan agreements.


0 Comments

Leave a Reply

Avatar placeholder

Your email address will not be published.