A simple loan agreement is a document that outlines the terms and conditions of a loan between a lender and a borrower. Whether you`re lending money to a friend or family member, or you`re a small business owner looking to lend money to a customer, a simple loan agreement can help protect both parties in the event of any misunderstandings or disputes.

When drafting a simple loan agreement, it`s important to include the following information:

1. The names and contact information of the borrower and lender.

2. The amount of the loan.

3. The interest rate, if any.

4. The repayment schedule, including the amount and frequency of payments.

5. The consequences of default, such as late fees or collection efforts.

6. Any collateral or security that is being offered to secure the loan.

To help you get started, we`ve created a simple loan agreement template that you can use as a starting point:

[Loan Agreement]

This agreement is entered into on [date] between [lender`s name and contact information] (“Lender”) and [borrower`s name and contact information] (“Borrower”).

Loan Amount: [amount]

Interest Rate: [rate], if any.

Repayment Schedule: The loan will be repaid in [number] equal payments of [amount] each, with the first payment due on [date] and subsequent payments due on the [date] of each month thereafter. The final payment will be due on [date] and will include any remaining principal and interest.

Default: In the event that the Borrower fails to make a payment when due, a late fee of [amount] will be added to the outstanding balance. If the loan is in default for [number] consecutive payments, the Lender may take collection action, including but not limited to pursuing legal remedies.

Collateral: [If applicable] The Borrower is offering [description of collateral or security] as security for the loan.

This agreement represents the entire understanding between the parties and shall not be modified except in writing signed by both parties.

Lender: [signature and date]

Borrower: [signature and date]

By using a simple loan agreement template like this one, you can ensure that your loan is clearly defined and that both parties are aware of their responsibilities. Remember to read and understand the terms of the loan agreement before signing, and if you have any questions, don`t hesitate to seek legal advice.