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What type of document should I write for a personal loan?

Does anyone know the format/template for writing a contract out for a personal loan? Does it need to be notarized/have any legal action to be considered legitimate legally?

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Answer #1

Make sure that within the loan agreement you make provisions for what will happen if there is late payment, or no payment, or insufficient payment. Think about interest, think about when payments will be due. Make sure that there is always proof of payments made and not just cash - so in case problems arise you will both have proof as to what has and hasn’t been paid.

And I agree with texaskimmie - loaning to friends can be hurtful to relationships -so work out all the possible problems now so that if they arise you will both know what is going to happen.

Best of luck!

Answer #2

A good way to lose friends is to loan them money. Be careful and be sure this is what you want to do. Often money comes between people, and the relationships are never the same. Just something to think about.

Answer #3

You’re loaning money personally? I’d get the document notarized, at least, and use a template from a reputable source for the loan contract. Nolo publishing has books with this kind of template in them, we purchased a package of their contracts when we started our consulting business, and it was worthwhile.

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