Use this contract:

• To grant a loan to be repaid on a due date, in a single repayment.
• Whether the loan is interest-free, with simple or compound annual interest, or one-off interest.
• Whether you are lending in pounds or foreign currency, in any amount.
• If you wish to impose additional guarantees and restrictions on the borrower.
• If you wish to provide for penalties and enforcement measures in the event of late repayment.

Protect yourself legally as a lender with the following options: 

• Stipulation of the conditions precedent to the granting of the loan and request for the creation of a real or personal security to guarantee repayment. 
• Prohibition on selling significant assets, taking on debt or giving more advantageous security to third-party creditors. 
• Obligation to regularly confirm declarations, disclose financial statements or tax returns, subject to immediate termination. 

• Interest on arrears and reminder charges in the event of late payment, with the borrower obliged to cover any legal costs in the event of enforcement. 
• Immediate termination in the event of a change of control, bankruptcy, or insolvency of the borrower. 

Safeguard your interests as a borrower by using the following clauses: 

• Possibility of early repayment, in full or in part, with cessation of interest. 
• Flexible calculation of simple interest with the option of a single or regular payment. 
• Option to specify a single interest rate that does not depend on the term of the loan. 
• Option to accumulate compound interest at different periods. 
• Limitation of reminder fees. 

Use this contract: 

• When you want to grant a loan without any particular guarantees, restrictions or penalties.
• To grant a loan to be repaid on a due date, in a single repayment.
• Whether the loan is interest-free, with simple or compound annual interest, or a one-off interest payment.
• Whether you are lending in pounds or foreign currency, for any amount.
• Whether the loan is between individuals or businesses.

Protect yourself legally as a lender with the following options: 

• Stipulation of the conditions precedent to the granting of the loan and request for the provision of preliminary security. 
• Interest on arrears and obligation to cover any additional damage in the event of late repayment. 
• Obligation to regularly confirm declarations regarding the borrower’s solvency, financial situation, and legal status. 

• Immediate termination in the event of the borrower’s bankruptcy or insolvency. 

Safeguard your interests as a borrower by using the following clauses: 

• Possibility of early, total or partial repayment. 
• Flexible calculation of simple interest with the option of a single or regular payment. 
• Option to specify a single interest rate that does not depend on the term of the loan. 
• Option to accumulate compound interest at different periods. 

Our loan contract template allows you to draft a professional simple loan contract to be signed between a lender and a borrower to secure the repayment of a loan. Using this agreement, it’s possible to mitigate financial risks and guarantee the repayment of the lent amount.

Lenders use our borrowing agreement template:

• To conclude a domestic or international loan until a maturity date, in British pounds or any foreign currency.
• To provide a borrowing free of any guarantees or restrictions, and to ensure reimbursement.
• To grant an interest-free borrowing or a loan with an interest rate, whether simple or compound.

Key Aspects of Loan Contract Template

• A loan document template is suitable for use by an individual, a registered business, or a company.
• This document should specify the principal sum and duration of the loan as well as describe the interest rate, where appropriate.
• By using a simple loan agreement, creditors waive any security or restriction on the borrower, along with any additional penalty.
• The lender may request sureties as a condition precedent or draft in a separate document.

Four tips on Lending Contract

When using our lending contract template, defend your financial and legal interests as the lender with the following tips, for example:

• Carefully verify the financial situation of the borrower since the simplified borrowing agreement sample provides no additional security.
• Demand preliminary guarantees and disclosure of the borrower’s financial situation before granting the loan.
• Include an acceleration clause in case the borrower becomes insolvent, starts debt restructuring proceedings, or acknowledges their inability to repay the borrowing.
• When applying an interest rate, opt for regular payments to occasionally verify the borrower’s solvency.

Customizing Document Template for Your Needs

Whether a lender or a borrower, you can draft a simple loan agreement template in just a few minutes using AdminTech’s online document builder, and be confident about the legal protection you receive.

With AdminTech’s simple loan contract template, simply fill in the fields with the required information, and the document shall automatically adjust to your specific needs.

Create a Simple Loan Contract with AdminTech

A professional loan contract template allows to cover the following information:

• Parties’ contact details and identification
• Currency and amount of loan
• Granting date and preconditions
• Reimbursement date
• Interest rate and accrual periods
• General warranties and representations of the borrower.

Borrowing Agreement Template FAQ

What options does AdminTech’s simple loan agreement sample offer for interest rates?

AdminTech’s borrowing agreement template offers lenders a choice between different types of interest. Single interest is charged on the entire amount borrowed, regardless of the term of the loan.

Annual interest is calculated on the term of the loan, proportional to a calendar year. It can be simple, which is paid at the end of the loan term or at regular intervals. It can also be compound interest, accrued as per the table of the basic loan agreement template.

How can I cancel a loan agreement once it has been approved?

A lending contract template is the basis for a binding legal document that obliges the lender to grant a loan and the borrower to repay it according to the agreed terms. Once a loan agreement is signed, it can be cancelled if:

• The contract was entered into under false or fraudulent circumstances.
• The terms of the contract have not been met.
• The borrowing is repaid on a date specified in the agreement.
• Early repayment of the loan (accelerated repayment).

When should you use a simplified loan agreement?

Lenders usually impose sanctions on borrowers, both as a deterrent and as compensation. Unlike the standard loan template, our simple loan agreement template does not provide such measures, it should only be used for the following purposes:

• Borrowing between related parties, such as family, friends, colleagues, or trusted business partners.
• Lending to a solvent and highly credit-worthy borrower.
• Formalising a loan concluded in a verbal form, for the purpose of reporting and proof.

What to do if the loan is not repaid on time?

In addition to the provisions of the loan document template, the lender has the following legal remedies to ensure repayment of the loan:

• Transferring a debt to a debt collection agency for a fee.
• The quest for a borrower’s commitment to provide personal assurance or collateral, typically in the form of a pledge or other security.
• If necessary, the involvement of a third-party guarantor.
• Recovery of the loan from the borrower in the courts of the borrower’s country of residence.

In practice, parties often grant a short grace period before such instruments can be applied.

What are the different types of loans?

There are different types of open-ended loans, depending on the wishes of the parties. In addition to the simple loan contract, AdminTech’s online document builder specialises in various options, some samples of which are shown below:

• A loan repayable in instalments
• A cash facility instrument with a maximum but undefined amount
• Convertible borrowing with share purchase rights
• Subordinated loan with deferral of payment.

What is the difference between a promissory note and a loan?

A loan agreement is signed in advance with a simple loan template, whereas a promissory note formalises a commitment to lend or repay the debt in any form.

Is a written form for a loan agreement necessary?

While verbal form is possible, we strongly recommend that you draft an agreement using our example of simple loan agreement to:

• Clearly express the intentions and terms of both parties.
• Establish legal title in case of debt enforcement (for example: mortgage or collateral).
• Provide legal proof in the event of transferring the loan to a third-party assignee.
• Have a necessary document for accounting, reporting, and tax purposes.

How can a lender guarantee a successful lending experience?

To ensure a fruitful borrowing experience, it’s often recommended to:

• Require an initial guarantee from the borrower and set a limit.
• Offer flexibility on amount and duration, depending on the situation.
• Allow a settlement period for an amicable resolution.
• Create and sign a simplified loan agreement using our simple loan agreement template.
• Use additional surety documentation to secure repayment.

Draft your legally binding loan contract template with the AdminTech online document builder.

Use this contract: 

• To grant a loan that must be repaid in regular instalments.
• Whether the loan is interest-free, with simple or compound annual interest, or one-off interest.
• Whether you are lending in pounds or foreign currency, in any amount.
• If you wish to impose additional guarantees and restrictions on the borrower.
• If you wish to provide for penalties and enforcement measures in the event of late repayment.

Protect yourself legally as a lender with the following options: 

• Stipulation of the conditions precedent to the granting of the loan and request for the creation of a real or personal security to guarantee repayment. 
• Prohibition on selling significant assets, taking on debt or giving more advantageous security to third-party creditors. 
• Obligation to regularly confirm declarations, disclose financial statements or tax returns, subject to immediate termination. 
• Interest on arrears and reminder charges in the event of late payment, with the borrower obliged to cover any legal costs in the event of enforcement. 
• Cancellation of the instalment plan and demand for immediate repayment in full if even one instalment is overdue. 

Safeguard your interests as a borrower by using the following clauses: 

• Flexible calculation of simple interest with the option of a one-off or regular payment. 
• Option to specify a single interest rate that does not depend on the term of the loan. 
• Option to accumulate compound interest over different periods. 
• Limitation of reminder fees. 

Use this contract: 

• To give the borrower the option of applying for loans up to the limit, as needed.
• Whether the loan is interest-free, with simple or compound annual interest, or one-off interest.
• Whether you lend in pounds or foreign currency, in any amount.
  

Protect yourself legally as a lender with the following options: 

• Stipulation of the conditions precedent to the granting of credit and request for the creation of a real or personal security to guarantee repayment. 
• Prohibition on selling significant assets, taking on debt or giving more advantageous security to third-party creditors. 
• Obligation to regularly confirm declarations, disclose financial statements or tax returns, subject to immediate termination. 
• Interest on arrears and reminder charges in the event of late payment, with the borrower obliged to cover any legal costs in the event of enforcement. 
• Immediate termination in the event of a change of control, bankruptcy or insolvency of the borrower. 

Safeguard your interests as a borrower by using the following clauses: 

• Possibility of early repayment, in full or in part, with cessation of interest. 
• Flexible calculation of simple interest with the option of a single or regular payment. 
• Option to specify a single interest rate that does not depend on the term of the loan. 
• Option to accumulate compound interest at different periods. 
• Limitation of reminder fees. 

Use this contract: 

• When you have taken out one or more loan contracts and the borrower needs an additional loan.
• If you wish to grant additional funds under the same conditions.
• If the additional amount is to be repaid on a specific date or at the same time as the existing loan.

Protect yourself legally as a lender with the following options: 

• Confirmation from the borrower that the old loan has been duly granted and will be repaid without reservation. 
• Stipulation of the conditions precedent to the granting of the additional amount and request for the provision of security on a preliminary basis. 
• Interest on arrears and the obligation to cover any additional damage in the event of late repayment. 
• Obligation to regularly confirm declarations regarding the borrower’s solvency, financial situation and legal status. 
• Immediate termination in the event of the borrower’s bankruptcy or insolvency. 

Safeguard your interests as a borrower by using the following clauses: 

• Possibility of early, total or partial repayment. 
• Flexible calculation of simple interest with the option of a single or regular payment. 
• Option to specify a single interest rate that does not depend on the term of the loan. 
• Option to accumulate compound interest at different periods.

Use this contract: 

• To grant a loan to a limited company incorporated in the United Kingdom.
• If you want the loan to be converted into capital instead of being repaid.
• Whether or not the loan bears interest, simple or compound, to be repaid or converted into capital.
• Whether you are lending in pounds or foreign currency, in any amount.
• When you wish to impose additional guarantees and restrictions on the borrower, or even penalties.

Protect yourself legally as a lender with the following options: 

• Adjustment of the loan conversion rate in the event of a significant fall in the value of the company up to the day of conversion. 
• Prohibition on selling significant assets, taking on debt or giving more advantageous guarantees to third-party creditors. 
• Obligation to regularly confirm declarations, disclose financial statements or tax returns, subject to immediate termination. 

• Interest on arrears and reminder charges in the event of late payment, with the borrower obliged to cover any legal costs in the event of enforcement. 
• Immediate termination in the event of a change of control, bankruptcy, or insolvency of the borrower. 

Safeguard your interests as a company by using the following clauses: 

• Imposition of a deadline for exercising the convertible option, as well as a preliminary condition to be met by the lender. 
• Possibility of waiving accrued interest if the option is exercised. 
• Indication of a fall in the value of the company to be tolerated by the lender, without the right to refuse the option. 
• Possibility of issuing the shares, or buying them from existing shareholders and selling them back to the lender.