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Sample Contract Loan between Friends

When it comes to lending money to friends, a written contract can help avoid misunderstandings and preserve the friendship. A sample contract loan between friends can ensure that both parties have a clear understanding of the terms and conditions of the loan, including the amount borrowed, the interest rate, and the repayment schedule.

Here is a sample contract loan between friends that you can use as a guide:

1. Loan Amount: $__________ (insert the amount borrowed)

2. Interest Rate: ___% per annum (insert the agreed-upon interest rate)

3. Repayment Period: _________ (insert the number of months for repayment)

4. Payment Amount: $__________ (insert the monthly payment amount)

5. Payment due date: The payment is due on the ____ of each month.

6. Late Payment Policy: If the borrower misses a payment, a late fee of $______ will be charged.

7. Collateral: (optional) If the borrower is unable to repay the loan, the lender may take possession of the following collateral: ________

8. Default: If the borrower fails to repay the loan according to the agreed-upon terms, the lender has the right to demand full repayment of the outstanding balance immediately.

9. Signatures: The borrower and lender must sign and date the contract to indicate their agreement to the terms.

It`s important to note that a written contract is legally binding, so it`s essential to make sure that both parties are comfortable with the terms before signing. It`s also a good idea to review the contract periodically to ensure that the terms are still agreeable for both parties.

In conclusion, a sample contract loan between friends can help ensure that both parties have a clear understanding of the loan terms and avoid misunderstandings that could potentially harm a friendship. With a written agreement in place, both the borrower and lender can enjoy peace of mind knowing that the terms of the loan are clear and agreed upon.