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Personal Loan Agreement (Individual)


Simple personal unsecured loan Agreement between individuals (related or unrelated). This is drafted in favour of the Lender.

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Document Description

The Personal Loan Agreement (Individual) is a document that outlines the terms and conditions of a personal loan between a lender and a borrower. This agreement establishes a legal framework for the loan, ensuring that both parties are aware of their rights and obligations.

The document is divided into several sections. Section 1 provides definitions for key terms used throughout the agreement.

Sections 2-3 outline the details of the loan (such as the amount of the loan and the terms under which it will be advanced), setting the foundation for the entire agreement.

Section 4 outlines the details of the interest such as the interest rate, the interest payment dates, and penalties for late payment, while section 5 specifies repayment, including the repayment date and other amounts payable.

Section 6 provides instructions on how payments should be made and whether there are any applicable taxes, while section 7 denotes the consequences of late payment and default.

Section 8 addresses the borrower's insolvency, while Section 9 concerns the invalidity or unenforceability of any provision in the agreement, stating any invalid or unenforceable provision will be read down or severed without affecting the remaining provisions.

Section 10 outlines the borrower's obligation to indemnify the lender against any loss incurred in connection with the agreement, while Section 11 specifies the borrower is responsible for legal costs, stamp duties, fees, taxes, and charges

Section 12 gives the lender the flexibility to determine which liabilities will be paid off first and in what order, while section 13 specifies the methods of communication and the addresses to which notices should be sent. Also, section 14 emphasizes that time is of the essence in relation to the borrower's obligation to pay money.

Sections 15-17 address various miscellaneous matters, such as waiver or variation of provisions, supervening legislation governing law and jurisdiction, etc.

In short, this document is a comprehensive one that covers all aspects of a personal loan.


How to use this document?


1. Review the interpretation section to understand the definitions of key terms used throughout the agreement.

2. Read the loan section to familiarize yourself with the details of the loan, including the loan amount and the terms of advancement.

3. Understand the interest section, including the interest rate, interest payment dates, and penalties for late payment.

4. Take note of the repayment section, which outlines your obligation to repay the loan and any other amounts payable.

5. Follow the instructions in the payments and taxes section to ensure that your payments are made correctly and any applicable taxes are accounted for.

6. Be aware of the consequences of late payment and default outlined in the late charge and default section.

7. Understand the insolvency section and the implications of becoming insolvent while the loan is still outstanding.

8. Familiarize yourself with the severance section to understand the impact of any invalid or unenforceable provisions in the agreement.

9. Take note of your obligation to indemnify the lender for any loss incurred in connection with the agreement, as outlined in the indemnity section.

10. Be prepared to cover the costs and expenses specified in the costs section, including legal costs, stamp duties, fees, taxes, and charges.

11. Understand the lender's right to apply payments received towards your liabilities, as outlined in the application of money section.

12. Follow the requirements for giving notice as outlined in the notices section to ensure effective communication with the lender.

13. Remember that time is of the essence when it comes to your obligation to make timely payments, as stated in the time section.

14. Familiarize yourself with the miscellaneous provisions, including certificates, waiver or variation of provisions, supervening legislation, and the cumulative nature of rights, powers, and remedies.

15. Understand that third parties have no rights under the agreement, as stated in the no rights under contracts for third parties section.

16. Take note of the governing law and jurisdiction specified in the governing law and jurisdiction section, as this will determine the legal framework for any disputes.


Please note that this guidance is a summary and does not replace a thorough review of the entire agreement. It is important to consult legal professionals for specific advice and to ensure compliance with applicable laws and regulations.

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