Sample Loan Contract (USA)

dknightx · #1 12-14-2005, 02:10 AM

I'm planning on letting a friend borrow a substantial amount of money (for the purpose of this thread, let's just say 15K). Does anyone know where I could find a Loan Contract that would hold up in a court of law (USA)? I trust my friend to repay, but a contract/agreement is just a necessary step "just in case". Thanks.

#2 12-14-2005, 04:23 AM

Sounds like your friend is using you just cause you have some money laying around. This loan would just cause problems with your friendship. The best thing to do is force him to get the loan from a bank.

jmillerdls · #3 12-14-2005, 04:56 AM

wow, amazing how much information you picked up from such a short post. I didn't identify all of these subtelties from reading...guess I'll read it again.

tonypaladino · #4 12-14-2005, 06:39 AM

[ QUOTE ]
Sounds like your friend is using you just cause you have some money laying around. This loan would just cause problems with your friendship. The best thing to do is force him to get the loan from a bank.

[/ QUOTE ]

I didn't notice where OP asked adise about if he should lend money or not, could you point that out for me?

soko · #5 12-14-2005, 10:18 AM

I am pretty sure if you write a check and put "Loan for XXX" in the for box that a copy of the check would hold up in a court.

NewGuy · #6 12-14-2005, 10:44 AM

Only on 2+2 could a request for a sample loan form turn into a multi-post pissing contest.

Here's a couple:
google link
http://www.medlawplus.com/legalforms...-loanagree.pdf
http://www.lawdepot.com/contracts/loanagree/

Not that you asked, but I've loaned money to friends in the past so 2 unsolicited suggestions:
1) It helps avoid any awkwardness later if at the very least you specify in writing an exact date the loan is due to be paid off & what penalties like a high interest rate or $ amount that are incurred if loan is not paid off in time.
2) Charge interest that's more than you'd get on your own and less than they'd pay to a bank.

phish · #7 12-14-2005, 10:53 AM

Unless you have collateral, the contract probably isn't worth a lot since if he ain't got it, you ain't gonna get it. And if he has it and doesn't want to pay, the cost of collecting it will eat up much of what the loan's worth and ruin your friendship.

Other than credit card loans, banks don't give personal loans with no collateral for good reason. A contract is just a piece of paper. It's better than not having one, but don't think that your money's secure just cause you have a 'contract.'

dknightx · #8 12-14-2005, 12:29 PM

Thanks for the info guys. I was hoping someone could speak more on the issue of "collateral", as my friend does not really have anything worth close to the amount I am loaning. Car is owned by the parents, and they just recently graduated from college.

#9 12-14-2005, 01:34 PM

Whether the loan contract is good or not depends on the state that you live in, but most basic promissory notes should work. As for collateral, if he doesn't have anything, then you don't have any. What is he doing with the money? If he's buying something with it, then take an interest in that. It sounds like he doesn't have real property, so you would most likely be taking an interest in personal property. The UCC governs that, and it has been adopted in whatever state you live in in one form or another. Check Article 9. Those forms are pretty standard from state to state, though.

Sorry - I know I'm a noob here, but this is sort of what I do.

dknightx · #10 12-14-2005, 01:37 PM

It's a very long story ... let's just say I am helping him pay back a debt, and he rather owe me money then someone else. The reason I am doing this is not important, as I already have thought this through. My friend has no personal property worth anything close to what the loan amount is. Collateral is not a big issue, as I trust them to pay me back, I am just interested to see if it is something I should look into.