Loan Repayment Agreement Between Friends Template for England and Wales

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Loan Repayment Agreement Between Friends

"I need a Loan Repayment Agreement Between Friends for lending £5,000 to my university friend, with monthly repayments over 18 months starting from March 2025, including a 2% interest rate and early repayment options."

Document background
A Loan Repayment Agreement Between Friends is essential when individuals lend money to friends in England and Wales, providing a formal structure to an informal arrangement. This document helps prevent misunderstandings by clearly stating the loan amount, repayment terms, and any interest charges. It offers legal protection while maintaining the friendly nature of the arrangement. The agreement is particularly useful for loans exceeding £140, as these may fall under the Consumer Credit Act 1974. It should be used whenever friends engage in financial lending to ensure both parties' interests are protected and expectations are clearly documented.
Suggested Sections

1. Parties: Identifies the lender and borrower with full names and addresses

2. Background: Explains the context of the loan and relationship between parties

3. Definitions: Defines key terms used in the agreement

4. Loan Amount and Purpose: Specifies the exact amount being lent and its intended use

5. Repayment Terms: Details payment schedule, amounts, and method of payment

6. Interest: Specifies whether interest applies and if so, the rate and calculation method

7. Duration: States the term of the loan and repayment deadline

8. Signatures: Space for both parties to sign and date the agreement

Optional Sections

1. Security: Details of any assets provided as security for the loan - use when the loan is secured against specific assets

2. Early Repayment: Terms for early repayment of the loan - use when parties want to allow for early repayment options

3. Default Provisions: Consequences of missing payments or breaching terms - use when parties want formal default procedures

4. Dispute Resolution: Process for resolving disagreements - recommended for larger loans or where parties want formal dispute procedures

Suggested Schedules

1. Repayment Schedule: Detailed breakdown of payment dates and amounts

2. Security Details: Description of any security provided for the loan

3. Bank Details: Payment account information for both parties

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Industries
A Loan Repayment Agreement Between Friends is essential when individuals lend money to friends in England and Wales, providing a formal structure to an informal arrangement. This document helps prevent misunderstandings by clearly stating the loan amount, repayment terms, and any interest charges. It offers legal protection while maintaining the friendly nature of the arrangement. The agreement is particularly useful for loans exceeding £140, as these may fall under the Consumer Credit Act 1974. It should be used whenever friends engage in financial lending to ensure both parties' interests are protected and expectations are clearly documented.
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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