Below is a free personal loan agreement template that you can use to craft your own. Keep in mind that if you are seeking legal advice, you should contact a lawyer near you. Whether you are borrowing or lending money to a friend, family member, coworker or acquaintance, it is extremely important that create a written document with the agreed upon conditions.
If you do not have the conditions in writing, there is nothing you can really do when the borrower decides to not pay you back. In your personal loan agreement, always include the exact amount of the loan, the date of when the loan was provided, the date for when the loan is to be paid back, and the names and signatures of all the parties involved.
Free Personal Loan Agreement Template
This is a contract being entered by I, Falco Lombardi, and James McCloud. On today’s date, May 31st 2014, I am letting Falco Lombardi borrow a short-term personal loan in the amount of $250. This is a cash loan that is going to be paid back in installments.
The installment payments will not start until June 1st 2014, and they will be paid in cash. James will be furnished with a receipt as proof of payment. The installment payments will be done on the 15th and 30th of every month in the amount of $50 each payment. If payment is not made by the 15th or the 30th, then there will be a late-fee assessed in the amount of $20 that will be added to the principle of the loan.
This will be a one-time fee for any payments that are missed after the 1st or the 15th of every month. If James makes his payment before the 15th or the 30th, then it will count for the next closest payment date. Payments less than $50 will not be accepted. However, if James wants to pay more than $50, then it will be deducted from the total amount. If the amount is not paid in full by November 1st, 2014, then I can take James to a small claims court to get a court order for payment.
By signing this agreement, James also understands that he will be responsible for any other court costs incurred if it goes to a small claims court. James has also provided two character references and pay stubs to secure this loan.
Lender Signature, Date
Borrower Signature, Date