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Personal Loan Agreement Template

One person lends money to another and both record the amount, the repayment dates and what happens if a payment is missed. Download it in Word or PDF, or fill it in online and print it.

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LOAN AGREEMENT

This Agreement is made on ____________ between:
(1) ____________, of ____________ (the “Lender”); and
(2) ____________, of ____________ (the “Borrower”).
1. The Loan
The Lender agrees to lend the Borrower the sum of ____________ (in words: ____________) (the “Loan”). The Lender shall pay the Loan to the Borrower on ____________ by ____________ (cash / bank transfer / cheque). The Borrower shall confirm receipt in writing.
2. Interest
The Loan bears interest at ____________% a year on the amount outstanding, calculated from the date the Loan is paid. (If the Loan is free of interest, write “nil”.)
3. Repayment
The Borrower shall repay the Loan and interest as follows: ____________ (for example: in ____________ equal monthly instalments of ____________, the first on ____________ and the rest on the same day of each following month; or in one payment on ____________). The Borrower may repay all or part of the Loan early without penalty.
4. Method of Payment
Payments shall be made to the Lender by ____________. The Lender shall give a receipt for each payment made in cash.
5. Late Payment
If a payment is not made within ____________ days of its due date, the Borrower shall pay interest on the overdue amount at ____________% a year from the due date until it is paid.
6. Default
The whole balance of the Loan and interest becomes payable at once if the Borrower: (a) fails to make a payment within ____________ days of being asked in writing to do so; (b) is declared bankrupt or insolvent; or (c) has given information in connection with this Agreement that proves to be false in a material way.
7. Security
(Delete if not applicable.) As security for the Loan, the Borrower gives the Lender the following: ____________. The security shall be released when the Loan and interest have been repaid in full.
8. General
This Agreement is the whole agreement between the parties about the Loan and may be changed only in writing signed by both. The Borrower may not transfer its obligations to anyone else. A delay by the Lender in enforcing a right is not a waiver of it.
9. Governing Law
This Agreement is governed by the laws of ____________, and the courts of ____________ have jurisdiction over any dispute arising from it.

The Lender
Signature: ____________
Name: ____________
Date: ____________

The Borrower
Signature: ____________
Name: ____________
Date: ____________

Witness 1 — Name: ____________ Signature: ____________
Witness 2 — Name: ____________ Signature: ____________

When is a loan agreement used?

When money is lent between people who know each other — family, friends, colleagues — or by a person to a small business. Writing it down protects the friendship as much as the money: both sides know exactly what was lent and when it comes back.

Signing and where it goes

Both parties sign it, with two witnesses, when the money is handed over. Each keeps a signed copy, together with proof of the payment such as a bank transfer record.

Points to get right

  • Pay the loan by bank transfer where you can. It gives proof of the payment that a cash loan does not.
  • Write the amount in figures and in words, and make sure they match.
  • Check the law on interest where you live: some countries cap it, and some communities lend free of interest. Write “nil” if there is none.
  • If the loan is large, consider security, and get advice on how that security must be recorded to be effective.

How to fill it in

  1. Press Open in editor, or download the Word file to fill it in on your computer.
  2. Replace every blank line with your own details, and delete the clauses and choices that do not apply.
  3. Read it through once more as the other party would read it.
  4. In the editor, press Print / PDF to make a PDF, or Word in the File tab to save a Word file.

Before you sign

These templates are general forms written to save time, not legal advice. The law differs from country to country and changes, and a paper about property, money or employment has legal effect. Fill in every blank, delete what does not apply, check the result against the law where you are, and have an important document reviewed by a lawyer before it is signed.

Questions

Questions and answers

What is the difference between a loan agreement and a promissory note?

A promissory note is a short, one-sided promise by the borrower to pay. A loan agreement is signed by both sides and sets out all the terms, including default and security. For larger loans, a loan agreement is safer.

Should the agreement be on stamp paper?

In countries that charge stamp duty on agreements, such as India and Pakistan, it is usually written on stamp paper of the correct value. Ask a stamp vendor or lawyer for the value.

Is this loan agreement template free?

Yes. You can download it in Word or PDF, or fill it in online and print it, without payment or sign up, and no watermark is added.

Can I edit it online?

Yes. Press Open in editor: the template opens as an ordinary document in your browser. Fill in the blanks, change any clause, then download it as a Word file or a PDF.

Is it valid in my country?

It is written in a general form that is used in many countries, but the law differs from place to place. Check it against the rules where you are, and have an important document reviewed by a lawyer.

Is what I type sent anywhere?

No. What you type stays in your own browser on your device. Nothing is uploaded.

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