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Loan Release Agreement Template for Singapore

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Loan Release Agreement

"Need a Loan Release Agreement for a fully repaid business loan of SGD 500,000 from DBS Bank, with the release of two corporate guarantors and the discharge of security over company equipment, to be effective from March 1, 2025."

What is a Loan Release Agreement?

A Loan Release Agreement is essential when a loan has been fully repaid or settled, and formal documentation of the discharge is required. This document, governed by Singapore law, provides legal certainty that the borrower's obligations have been fulfilled and that the lender releases all claims related to the loan. It protects both parties by clearly documenting the termination of the lending relationship and can be particularly important for secured loans or those with guarantors. The agreement should comply with Singapore's banking regulations and contract law requirements.

What sections should be included in a Loan Release Agreement?

1. Parties: Identification of lender and borrower

2. Background: Details of original loan agreement and reason for release

3. Definitions: Key terms used in the agreement

4. Release Provisions: Terms of release from loan obligations

5. Acknowledgment of Payment: Confirmation of loan repayment or settlement

6. Effective Date: When the release takes effect

7. Governing Law: Specification of Singapore law as governing law

What sections are optional to include in a Loan Release Agreement?

1. Security Release: Release of any security held against the loan - include when loan was secured by collateral

2. Guarantor Release: Release of guarantors from obligations - include when loan had guarantors

3. Partial Release Provisions: Terms for partial release of obligations - include when only part of the loan is being released

4. Confidentiality: Confidentiality obligations regarding the release - include when parties require confidentiality

What schedules should be included in a Loan Release Agreement?

1. Schedule 1 - Original Loan Agreement: Copy of the original loan agreement being released

2. Schedule 2 - Payment Evidence: Proof of final payment or settlement

3. Schedule 3 - Security Documents: List of security documents being discharged (for secured loans)

4. Schedule 4 - Release Authorizations: Corporate or other authorizations for the release (when required by corporate parties)

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions



























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Industries

Contracts Act (Cap. 53): Primary legislation governing contract formation, validity of contractual terms, and discharge of obligations in Singapore. Essential for the basic structure and enforceability of the loan release agreement.

Banking Act (Cap. 19): Regulates banking institutions and their lending activities in Singapore. Relevant if the loan involves a banking institution, including specific regulatory requirements for loans and their discharge.

Moneylenders Act (Cap. 188): Governs licensed moneylenders, including interest rate restrictions and licensing requirements. Applicable if the lender is a licensed moneylender rather than a bank.

Civil Law Act (Cap. 43): Contains provisions regarding interest rates and enforcement of contracts in Singapore. Provides framework for civil obligations and their discharge.

Limitation Act (Cap. 163): Establishes time limits for bringing claims and statutory limitation periods. Important for understanding the timeframe within which the release agreement must be executed.

Personal Data Protection Act 2012: Regulates the collection, use, and disclosure of personal data. Relevant for handling personal information in the loan release agreement.

MAS Guidelines: Regulatory guidelines issued by the Monetary Authority of Singapore, particularly relevant if the loan involves regulated financial institutions.

Common Law Principles: Relevant precedent cases and legal principles regarding loan agreements and discharge by release, supplementing statutory law.

Stamp Duties Act (Cap. 312): Governs the imposition of stamp duties on legal documents, including requirements for stamp duty on loan and release documentation.

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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