As we all know, a dispute over money can ruin the best of relationships. This is even (or perhaps especially!) the case between family and friends. The best way to avoid disputes when lending or borrowing money is to keep a clear record of what is agreed.
This will also ensure that:-
- Both parties actually consider what the terms of the loan are going to be. Is there going to be interest payable? When are you expecting the loan to be repaid? Completing a loan agreement will force you to consider these issues.
- You have a clear record of the agreement over time. Even with the best intentions, your memory can fade and the terms of a verbal agreement are soon forgotten.
- You have a record to substantiate your claim against third parties. For example, the borrower is separating from their spouse and the spouse wants to take half the borrowed funds with them. A verbal loan agreement won’t stack up to prove that the funds are actually owed back to you.
Personal Loan Agreement
Our Personal Loan Agreement is suitable for recording basic interest only loans between family and friends.
Need something more detailed? Or perhaps with a caveat or mortgage as security? Feel free to get in contact with us and we can draft a loan agreement to suit your needs.
The crew at LegalRocket