A family loan agreement template is used when a family member wishes to borrow money from another member. This loan agreement between family members template outlines each party’s responsibility and takes their word in writing. It’s available for +free to help you simplify the process of lending money to family responsibly.
This Family Loan Agreement, hereby known as the “Agreement,” is entered into and made on this day of (Start.Date), hereby known as the “Effective Date,” by and between:
[Borrower.FirstName] [Borrower.LastName] , with a mailing address of [Borrower.StreetAddress] [Borrower.City] [Borrower.State] [Borrower.PostalCode] , hereinafter known as the “Borrower,” and
[Lender.FirstName] [Lender.LastName] , with a mailing address of [Lender.StreetAddress] [Lender.City] [Lender.State] [Lender.PostalCode] , hereinafter known as the “Lender,” who will collectively be referred to as the “Party” or “Parties.
On the Effective Date, the Borrower agrees to accept and repay the “Family Loan” given by the Lender, in full on or by the Final Loan Delivery date as pursuant to the entire terms of this Agreement.
Subject to the terms and conditions set forth herein, the Lender agrees to loan the Borrower the principal sum of $(Enter amount) (the “Loan”). The Loan shall be provided to the Borrower in the form of a check, cash, or bank transfer at the Lender’s discretion.
This family loan agreement template considers that the Borrower will repay the loan in a single payment. If you prefer to set weekly or monthly payment terms, outline that here. In that case, you need to include the amount of each payment and the day of the month/week when it’s due.
The Borrower agrees to repay the Loan, plus any applicable interest, in full by (Enter.Date).
The Borrower may also prepay the Loan in full at any time without penalty.
It’s not required to charge interest on a family loan, but it can be useful if the amount exceeds $14,000.00, as this will incur tax liabilities. If you’ll charge interest, make sure to check the anti-usury limits in your states to be sure of the maximum you can charge.
The Loan shall bear interest at a rate of (Insert percentage)%, calculated on a monthly basis and due at the time of repayment.
Payment shall be considered late if not made by (Enter time) on the (Enter day) calendar day of each month. All late payments are subjected to a late fee of $(Enter amount) OR (Enter percentage)%.