Personal Loan Agreement (Individual)

Date:     [date of agreement]
Parties:       [Borrower’s full name] (“Borrower”)
         [Lender’s full name] (“Lender”)

1    Interpretation

Definitions

1.1    In this agreement:
Business Day means a day, not being a Saturday or a Sunday, on which banks are open for general banking business in [jurisdiction city, country].

Interest Rate means the rate of [interest rate]% per annum. 

Interest Payment Date means the 1st day of each month, commencing on [interest payment date], until the Repayment Date.

Loan means the amount stated in clause 2.

Loss includes claim, liability, damage costs and expense.

Other Amounts Payable means all amounts other than the Principal Outstanding payable by the Borrower under this agreement.

Parties means the Borrower and the Lender and Party refers to either of them.

Principal Outstanding means the amount of the Loan which has been advanced from time to time and not repaid.

Relevant Jurisdiction means [jurisdiction city, country].

Repayment Date means the date or dates determined in accordance with clause 5.1.

Tax means any tax, levy, impost, duty or other charge or withholding of a similar nature (including any penalty, interest or other amount payable in connection with any failure to pay or any delay in paying any of the same).

Interpretation rules
1.2    In this agreement, unless the contrary intention appears:
(a)    the singular includes the plural and the opposite and any gender includes the other genders;
(b)    an obligation:
(i)    in favour of two or more persons is for their benefit jointly and severally;  and
(ii)    by two or more persons binds them jointly and each of them severally;
(c)    a reference to:
(i)    a person includes that person’s executors, administrators, successors and assigns;
(ii)    a document means that document as amended or replaced;
(iii)    a statute or other law means that statute or other law as amended or replaced, whether before or after the date of this agreement and includes regulations and other instruments made under it;
(iv)    to a clause or a schedule is a reference to a clause or a schedule in this deed;
(v)    a thing or an amount includes the whole and each part of it;
(vi)    a month means a calendar month;
(vii)    includes any person acting in that capacity;
(d)    where the word ‘including’ or ‘includes’ is used, it is to be taken to be followed by the words: ‘but not limited to’ or ‘but is not limited to’, as the case requires;
(e)    where a period of time is expressed to be calculated from or after a specified day, that day is included in the period;  and
(f)    ‘party’ means a party to this agreement.

2    The Loan

At the request of the Borrower, the Lender agrees to advance [currency] [loan amount] to the Borrower on the terms of this agreement.

3    Advance of the Loan

The Loan is to be advanced at the times and in the manner agreed between the Lender and the Borrower.

4    Interest

4.1    The Borrower is to pay:
(a)    interest at the Interest Rate calculated on the daily balance of the Principal Outstanding from and including the date the Loan or any part of it is first advanced until the Principal Outstanding is fully repaid; and
(b)    on each Interest Payment Date, all interest accrued but unpaid on the Principal Outstanding as at that Interest Payment Date, without set-off or deduction, including for Taxes.

4.2    If any payment default occurs, all interest then becomes payable on demand.

4.3    The Borrower is to pay on demand interest at the Interest Rate on any Other Amount Payable from when it becomes due for payment until it is paid.

4.4    Any interest which is not paid when due for payment may be capitalised by the Lender at such intervals as the Lender may decide. Interest is payable on capitalised interest calculated as provided in clause 4.1(a) and on demand.

4.5   The Borrower shall be entitled to pay larger instalments than prescribed or the full balance of capital and interest at any time prior to the prescribed dates of payment. In any such event interest shall be calculated up to the date of payment.

4.6    If a liability under this agreement becomes merged in a judgment or order, then the Borrower agrees to pay interest to the Lender on the amount of that liability as an independent obligation. This interest accrues from the date the liability becomes due for payment both before and after the judgment or order until it is paid, at a rate that is the higher of the rate payable under the judgment or order and the Interest Rate.

5    Repayment

The Borrower is to repay the Principal Outstanding and all Other Amounts Payable

6    Payments and taxes

All payments are to be made:
(a)    to the Lender at its address shown in clause 13.1 or such other address as the Lender may notify to the Borrower;
(b)    between the hours of 9.00 a.m. and 5.00 p.m. on a Business Day, but if a payment becomes due on a day that is not a Business Day, then the date for payment is the preceding Business Day;
(c)    without set off or deduction including for Taxes; and
(d)    in [currency] dollars.

7    Late Charge and Default

7.1 Late Charge: Any payment not remunerated within 10 days of its due date shall be subject to a belated charge of 5 percent (%) of the payment, not to exceed $500 for any such late installment.

7.2 Default: If Borrower has not paid the full amount of the loan when the final payment is due, the Lender will charge Borrower interest on the unpaid balance at 20 percent (%) per year.

8    Insolvency

If the Borrower becomes insolvent, the Lender may demand immediate repayment of the Principal Outstanding and the payment of any Other Amount Payable then unpaid, notwithstanding any other provision of this agreement; and the Borrower agrees to immediately comply with such a demand.

9    Severance

Any provision of this Deed that is invalid or unenforceable will be read down where possible so as to be valid and enforceable, or, if that is not possible, will be severed from this Agreement to the extent of its invalidity of unenforceability, without affecting the remaining provisions, which will remain binding on the Parties.

10    Indemnity

The Borrower indemnifies the Lender, and the officers and employees of the Lender against any Loss suffered or incurred by the Lender or any of its officers or employees in connection with:
(a)    any Taxes payable by the Borrower;
(b)    any payment default.

11    Costs

The Borrower agrees to pay or reimburse the Lender on demand for:
(a)    the Lender’s costs and expenses in making, enforcing and doing anything in connection with this agreement including legal costs and expenses on a full indemnity basis; and
(b)    all stamp duties, fees, taxes and charges which are payable on or in connection with this agreement or a payment, receipt or other transaction made under or in connection with this agreement.

12    Application of money

The Lender may apply all amounts received by it from the Borrower in such manner and against such of the liabilities of the Borrower to the Lender and in such sequence as the Lender may decide.

13    Notices

13.1    Any notice or other communication in connection with this agreement is to be in writing, signed by the Party giving it or that Party’s solicitor and it may be:
(a)    left at the address of the addressee;
(b)    sent by prepaid ordinary post (airmail if posted to or from a place outside the Relevant Jurisdiction) to the address of the addressee; or
(c)    sent by facsimile to the facsimile number of the addressee,
the particulars of which are as follows:
(d)    Borrower
Address: [Borrower’s address]
(e)    Lender
Address: [Lender’s address]
or any other address or number which is notified by one Party to the other Party.

13.2    Any notice or other communication takes effect from the time it is received unless a later time is specified in it, and it is taken to be received:
(a)    if left at the address of the addressee, at the time it is left;
(b)    if it is posted, on the third Business Day after posting (seventh, if posted to or from a place outside the Relevant Jurisdiction); and
(c)    if it is sent by facsimile, on production of a transmission report by the machine from which the facsimile was sent which indicates that the facsimile was sent in its entirety to the facsimile number of the addressee.

14    Miscellaneous

14.1    A provision or right created under this agreement may not be waived or varied except in writing signed by the Party or Parties to be bound.

Supervening legislation

14.2    Any present or future legislation which operates to vary the Borrower’s obligations under this agreement is excluded except to the extent that its exclusion is prohibited or rendered ineffective by law.

14.3    The rights, powers and remedies provided for by this agreement are cumulative with and not exclusive of the rights powers and remedies provided by law, independently of this agreement.

15 No Rights under Contracts for Third Parties

A person who is not a party to this Agreement shall have no right under any law to enforce any of its terms.

16    Governing law and jurisdiction

This document is governed by and are to be construed in accordance with [jurisdiction] Law.

IN WITNESS WHEREOF, the parties have executed this agreement as of the day and year first above written.

SIGNED BY )

For and on behalf of )

_________________

SIGNED BY )

For and on behalf of )

_________________

LOAN ADVANCE SCHEDULE

Advance of the Loan (Clause 3)

Date                Amount
   
   
LOAN REPAYMENT SCHEDULE

Repayment (Clause 5)

Date                Amount