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A loan agreement should be structured to include information about the borrower and the lender, the loan amount, and repayment terms, including interest charges and a timeline for repaying the loan. It should also spell out penalties for late payments or default and should be clear about expectations between parties.

A loan agreement is a document, signed by both the lender and the borrower, that spells out the terms of the loan. These agreements are binding and can be simple or complex. The loan agreement lays out the repayment schedule, the costs to the borrower, and other rules or requirements.

Once it has been executed, it is essentially a promise to pay from the lender to the borrower. Borrowing money is a big commitment no matter the amount, which is why it is important to protect both parties with a loan agreement in place.

Secured loans are loans which require the borrower to pledge an asset or security to avail the loan. Home loans and car loans are the most common examples of secured loans where the borrower will be required to pledge the vehicle or house to be purchased as collateral, which then become secured debt.

What a personal loan agreement should include Legal names and address of both parties. Names and address of the loan cosigner (if applicable). Amount to be borrowed. Date the loan is to be provided. Repayment date. Interest rate to be charged (if applicable). Annual percentage rate (if applicable).

A contract for a collateral loan should clearly state what asset(s) are being used to secure the loan and include a clause on what could happen to the asset if the borrower defaults. It should also clearly outline the circumstances under which the collateral could be forfeited to the lender.

You can write up a personal loan agreement by hand, with pen and paper, or draft it on your computer. Once the document looks good, it can be printed out and signed by both parties.