Document background
A Car Loan Agreement Between Friends is essential when individuals in New Zealand enter into private lending arrangements for vehicle purchases. This document should be used whenever one friend or private individual lends money to another specifically for buying a car, whether new or used. The agreement provides legal protection for both parties while maintaining the informal nature of a friendly arrangement. It includes crucial details such as loan amount, repayment terms, vehicle specifications, security interests, and maintenance requirements. Governed by New Zealand law, particularly the Contract and Commercial Law Act 2017 and Credit Contracts and Consumer Finance Act 2003, this agreement helps prevent misunderstandings and provides a clear framework for the lending arrangement. It's particularly important for documenting the security interest in the vehicle and establishing clear repayment terms, while being simpler and more flexible than commercial loan agreements.
