Loan Agreement Template 3
Loan Agreement Template 1
Loan Agreement Template 2
Loan Agreement Template 3
Loan Agreement Template 1

Loan Agreement Template

    Our loan agreement template incorporates every loan detail so that the borrower and the lender will not have disputes about the money. It is well formatted and reviewed by legal and financial practitioners! Download this free template and easily create your own loan agreement with our help!

Download templateUse template
Loan Agreement Template
PDF Word

Loan Agreement Template

Fill & sign this document online

Whether it’s for business or student, or simply an amount of money that we are lending to a relative, loans are a part and parcel of daily life and so is the need for a loan agreement.

If you wish to learn more about loan agreements such as what they are, why and where they are used, and what they comprise of, this article will answer all your doubts. Simply read on, and you’ll be a much more informed lender or borrower within a few minutes.

Have you been searching for a ready to use loan contract template? We have got that covered as well. Download our simple loan agreement template and use it at no extra charge!

Alternate Names for Loan Agreement

There are various ways of referring to a loan agreement. Some people call it a ‘promissory note’, while others may refer to it as a ‘term loan’ document. You may also find people calling it an ‘IOU’ (I Owe You) document or a ‘Note Payable’.

All these terminologies mean the same thing and you can use this loan agreement template.

What Is a Loan Agreement?

It is a legal document between the borrowing and the lending party that stipulates the conditions of the loan and the promises made by both the parties. Its purpose is to protect both the parties in case a dispute arises and the court has to step in

In general, any loan agreement template explicitly lists out the basic loan terms like the loaned amount and the agreed-upon interest rate, repayment timeline, collateral (if it’s there), default penalties, along with any specific terms and conditions.

Access a 100% Free Loan Agreement Template Today!

You don’t have time to waste on complicated legal jargon or confusing legalese. That’s why we’ve created this simple, easy-to-use template for everyone from entrepreneurs looking for funding, to business owners seeking loans from banks or investors.

Try us out now - click below right away!

What Can You Use a Loan Agreement for?

A loan agreement is used for a variety of loans. There is a loan agreement between individuals, between businesses, or between business and an individual. Some top of the mind examples of its applications are:

  • Loans taken by students for funding tuition or other education-related expenses.
  • Loans to fund the purchase of any item like a car, electronic appliance, furniture, etc.
  • Loans related to real estate, such as the purchase of a home or property.
  • Loans for business expansion such as capital investment in your factory, startup, etc.
  • Loans or simple IOUs between relatives, friends or colleagues.

Why do People Use a Loan Agreement?

Loan agreements are useful because they clearly outline what each of the parties is agreeing to, and what are their responsibilities. A loan agreement form is a binding contract and it formalizes the loan process.

It protects the lender’s interest as it enforces the borrower’s promise of repaying the money. It also makes it evident that the money being exchanged is a loan and not a gift.

If you are lending to your friends and family, a loan agreement can prevent later tussles over the lending terms. Loan agreement is also very useful for the borrowers as it clarifies the lender’s expectations and helps you plan your payments.

Check out our free loan agreement template and you can see that its various terms and clauses are thorough and remove any scope of misinterpretation

What Are Included in a Loan Agreement?

Every loan agreement template will cover some basic points:

  • Loan Amount: It stipulates the amount being exchanged, applicable interest rates, and how it will be computed (simple or compound).
  • Payment method: This means how the lender will receive money back from the borrower.
  • Repayment schedule: It lists out the number of installments, their dates, and amount.
  • Details of lender and borrower along with their addresses
  • Collateral: Some kind of security can be decided in advance in case the borrower is unable to repay the loan.

How Is a Loan Agreement Different from a Promissory Note?

Both the loan agreement and the promissory note are formal contracts that clarify the lending terms between the lender and the borrower. However, there are certain differences in their applications and hence minute differences in their loan template as well.

Promissory note is used for simple loans while a loan agreement typically involves an extensive payment schedule and terms. Thus, a loan agreement template is much more detailed than a promissory note.

Both the borrower and the lender need to sign a loan agreement while a promissory note needs only be signed by the borrower.

Access a 100% Free Loan Agreement Template Today!

You don’t have time to waste on complicated legal jargon or confusing legalese. That’s why we’ve created this simple, easy-to-use template for everyone from entrepreneurs looking for funding, to business owners seeking loans from banks or investors.

Try us out now - click below right away!


These agreements are useful for both the parties as they clearly outline every term and condition related to the loan. If you are entering into a loan, please download and use the free loan agreement template on CocoSign.

Are you also seeking something other than a loan agreement template? Whether it’s related to real estate, business, financial, or family-related requirements, we are into knowledge sharing and providing ready-to-use templates for all kinds of purposes.

So, check out our website, and take a step towards securing your interests!

Loan Agreement FAQ

  • Does the loan agreement need signatures of witnesses?

    No, you don’t always need to get a loan agreement signed from witnesses. It basically depends on where you are entering into the loan and what that region’s judiciary law states.

    Sometimes laws do require a witness, or even a public notary official to attest your loan agreement.

    Irrespective of the legal mandates, we feel that it is advantageous to get an objective outsider to witness your agreement being signed as it lends a greater credibility if you ever enter into a legal dispute.

  • What is interest and how is it calculated?

    Lenders levy an Interest amount on their borrowers in return for using their money. This is the lender’s fee for the inconvenience he is incurring and the risk he is taking in this exchange.

    Some people believe that the interest necessarily needs to be charged in a loan agreement. However that is not so. You may choose to have zero interest loans as well.

    Generally interest rates are specified as a percentage. 5% interest rate means 5% of the borrowed amount. Interest rates may be calculated at a specified period of time, say monthly, quarterly, annually, etc. Typically the rate of interest mentioned is the annual rate.

  • Do I have to get an independent contractor agreement for my company’s employees?

    No, there is no need for an independent contractor agreement for the employees of a company. The purpose of these contracts is to differentiate the contractor from an employee.

  • What are the different types of payment options?

    Loan repayment can be settled in four different ways, which include lump-sum, periodic payments of specific amounts, regular interest payments only, and regular interest and principal payments.

  • What is the meaning of a loan agreement governing law?

    You are bound by the laws of the jurisdiction in which you enter into the loan agreement. It is clearly and explicitly stated in the Governing Law Clause of a loan agreement template.

    Typically, the lender and the borrower agree to select the law of the lender’s jurisdiction. Sometimes when you are taking a loan to purchase some assets, the jurisdiction region could pertain to the location of these assets.

  • Is it necessary to keep collateral in a loan?

    No, it is not essential to keep collateral in your loan agreement form. However it is advisable to do so.

    If the loan without collateral gets defaulted, you will have to take the matter up with the court. Moreover, the judgment is enforceable only against specific assets of the borrowing party.

    On the other hand, if a collateral was agreed upon in the agreement, you are entitled to seize it and sell it to recover the due amount.




-          This Loan Agreement (hereinafter referred to as the “Agreement”) is entered into on ________________ (the “Effective Date”), by and between ________________________, with an address of ________________ (hereinafter referred to as the “Borrower”), and ________________, with an address of ________________ (hereinafter referred to as the “Lender”) (collectively referred to as the “Parties”).


-          The Parties agree to insert their basic information down below:
Name, address, email, phone number, references and their phone numbers, security and collateral items of the borrower: __________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

-          Name, address, email and phone number of the Lender:


-          The Parties agree that the loan information set below is accurate.

-          Start Date of the First Payment: ___________________________

-          End Date of the Last Payment:____________________________

-          Loan Amount:_________________________

-          Interest Rate:__________________________

-          Late Fee:_____________________________

-          Payment Method:_______________________


-          Hereby, the Parties agree that the Lender will lend ___________ to the Borrower as per this Agreement.


-          Hereby, the Parties agree that the date of the First Payment is ___________ and will continue until the date of the Last Payment, which is _____________.

-          The Payment is due every _________________.The method of payment will be __________________________________.


-          The Parties hereby agree that the Borrower promises to pay the Lender ____________ and the interest within _____________.


-          The Parties agree that any late payment of _____________ days will be subject to ________________ as late charges.


-          This Agreement will be regarded as default in case the Borrower does not pay by the due date, his/her death, bankruptcy and/or inability to pay.


-          The Parties agree that for the sake of protection of the Lender, the Borrower will provide the following security interest and/or mortgage.


-          The Parties agree that any amendments made to this Agreement must be in writing where they must be signed by both Parties to this Agreement.

-          As such, any amendments made by the Parties will be applied to this Agreement.


-          The Parties hereby agree not to assign any of the responsibilities in this Agreement to a third party unless consented to by both Parties in writing.


-          This Agreement shall be governed by and construed in accordance with the laws of ________________.


-          Any dispute or difference whatsoever arising out of or in connection with this Agreement shall be submitted to ________________ (Arbitration/mediation/negotiation) (Circle one) in accordance with, and subject to the laws of ________________.


-          This Agreement contains the entire agreement and understanding among the Parties hereto with respect to the subject matter hereof, and supersedes all prior agreements, understandings, inducements and conditions, express or implied, oral or written, of any nature whatsoever with respect to the subject matter hereof. The express terms hereof control and supersede any course of performance and/or usage of the trade inconsistent with any of the terms hereof.             


-          The Parties agree that this Agreement is not transferable unless a written consent is provided by both Parties of this Agreement.


-          In an event where any provision of this Agreement is found to be void and unenforceable by a court of competent jurisdiction, then the remaining provisions will remain to be enforced in accordance with the Parties’ intention.


-          The Parties hereby agree to the terms and conditions set forth in this Agreement and such is demonstrated throughout by their signatures below:












Related Agreement Templates

View All Documents >>

CocoSign represents a wide collection of legal templates covering all types of leases, contracts and agreements for personal and commercial use. All legal templates available on CocoSign shall not be considered as attorney-client advice. Meanwhile, CocoSign shall not be responsible for the examination or evaluation of reviews, recommendations, services, etc. posted by parties other than CocoSign itself on its platform.

Easier, Quicker, Safer eSignature Solution for SMBs and Professionals

  • No credit card required
  • 14 days free