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Simple Loan Agreement for the United States

Simple Loan Agreement Template for United States

A Simple Loan Agreement is a legally binding document used in the United States that establishes the terms and conditions under which one party (the lender) provides financial resources to another party (the borrower), with the understanding that the borrowed amount will be repaid according to specified terms. The agreement includes essential elements such as loan amount, interest rate, repayment schedule, and default provisions, while complying with federal and state lending regulations.

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What is a Simple Loan Agreement?

The Simple Loan Agreement serves as a fundamental legal instrument in the United States for documenting monetary lending arrangements. This agreement type is commonly used for personal loans, small business financing, and other straightforward lending situations where detailed commercial loan documentation may not be necessary. The Simple Loan Agreement includes key provisions regarding the loan amount, interest rate, repayment terms, and consequences of default, while ensuring compliance with applicable federal and state lending laws. It provides protection for both lender and borrower by clearly documenting their rights and obligations.

What sections should be included in a Simple Loan Agreement?

1. Parties: Identification of lender and borrower with full legal names and addresses

2. Background: Context of the loan and relationship between parties

3. Definitions: Key terms used throughout the agreement

4. Loan Amount and Purpose: Principal amount and intended use of funds

5. Interest Rate: Interest rate, calculation method, and payment schedule

6. Repayment Terms: Payment schedule, method, and duration

7. Default Provisions: Consequences of missed payments or breach

8. Representations and Warranties: Statements of fact and promises made by the borrower

9. Covenants: Ongoing obligations of the borrower during the loan term

10. Governing Law: Jurisdiction governing the agreement

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

1. Security: Details of any collateral securing the loan - include when loan is secured by assets

2. Guarantees: Third-party guarantees of repayment - include when a guarantor is involved

3. Prepayment Terms: Conditions for early repayment - include when early repayment is allowed or penalties apply

4. Insurance Requirements: Required insurance coverage - include when specific insurance is required for the loan

What schedules should be included in a Simple Loan Agreement?

1. Schedule A - Repayment Schedule: Detailed payment amounts and due dates throughout the loan term

2. Schedule B - Security Details: Description and details of collateral if secured loan

3. Schedule C - Truth in Lending Disclosure: Federal required disclosures about loan terms and conditions

4. Schedule D - Guarantor Information: Details of guarantors if applicable

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

Jurisdiction

United States

Document Type

Agreement Contract

Cost

Free to use

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