Fill Out Loan Agreement Online

What is a loan agreement

A loan agreement documents the entire lending relationship in one contract. It identifies the lender and the borrower, states how much is being lent and how it will be delivered, and sets the repayment terms, including interest, installment amounts, due dates, and the final maturity date.

It also covers what happens when things go wrong: events of default, the lender's right to accelerate the balance, late charges, and who pays collection costs. Boilerplate clauses on notices, assignment, governing law, severability, and amendments keep the contract predictable if a dispute ever reaches a court.

When to use a loan agreement instead of a promissory note

For a small, simple loan, a promissory note is often enough. A loan agreement earns its extra length when the loan is larger, when it is secured by collateral, when the money is delivered in a specific way or on a specific date, or when the lender wants written representations from the borrower.

Because both parties sign a loan agreement, it also works better when the lender is taking on obligations too, such as committing to deliver funds by a certain date. Many lenders use both documents together, with the agreement setting the deal and a note evidencing the debt.

What to include in a loan agreement

A complete loan agreement should cover every term the parties have actually agreed and the standard protections a lender would expect.

• The parties' full legal names and addresses, and the effective date.
• The principal amount, in words and numerals, plus how and when the funds will be delivered.
• The annual interest rate, or a statement that the loan bears no interest.
• The repayment schedule: lump sum, installments with amounts and due dates, or a custom schedule, ending on a maturity date.
• Late charges and the grace period before they apply.
• Whether the loan is secured, and a description of any collateral.
• Events of default, cure periods, acceleration, and collection costs.
• Governing law, notices, assignment, severability, and an entire agreement clause.

How to fill out the loan agreement template

In the Universal PDF editor, complete the header first: the effective date and both parties' names and addresses. Then work through the numbered sections, entering the loan amount in words and numerals, the delivery date and method, and the interest rate.

In the repayment section, check exactly one schedule option and fill only its blanks. Mark the loan as secured or unsecured, describe any collateral, and set the day counts for late charges and cure periods to the numbers you have agreed. Review the whole document on screen before downloading, since a blank left empty in a key term is the most common source of later disputes.

Signing and keeping records

Both the lender and the borrower must sign and date the agreement, and each should keep a fully signed copy. The template includes a counterparts clause, so the parties can sign separate copies that together form one contract.

Notarization is not normally required for a loan agreement, though parties can add it for extra evidentiary weight. If the loan is secured, remember that the agreement contemplates a separate security agreement and any filings needed to perfect the lender's interest in the collateral.

Common mistakes to avoid

Most loan agreement problems come from terms that were discussed but never written down, or blanks that were never completed.

• Leaving the interest, late charge, or cure period blanks empty and relying on a verbal understanding.
• Checking multiple repayment options or describing a schedule that does not add up to the principal plus interest.
• Failing to describe collateral precisely when the loan is secured.
• Amending the deal later by text message or email instead of a signed written amendment, which the agreement requires.
• Not keeping a signed copy for each party.