The loan agreement is the basis for secure cooperation between the client and the loan company. In it, you specify the parties to the contract, the cost of the loan, the rules on which the loan is granted, and more. In this article, we suggest what a well-structured loan agreement should contain.

The law imposes an obligation to conclude contracts in writing for a cash or material loan of $ 1,000 . However, it is good practice to conclude such contracts at a value of $ 500 . However, loan companies, taking care of their own and the client’s interest, borrowing up to $ 100 , will provide you with a loan agreement document to sign.


What should the loan agreement specify?

What should the loan agreement specify?

What are the mandatory elements of the loan agreement? We have prepared a list for you, which you can use whenever you decide to borrow or grant a loan.

  • Loan parties (borrower and lender)
  • Date and place of the loan agreement
  • Subject of the loan agreement
  • Conditions determining the repayment of the loan
  • Declaration regarding the financial situation of the borrower
  • Duration of the loan agreement
  • Determination of collateral and consequences when the loan repayment is not met
  • Information on the conditions for early repayment of the loan
  • Signatures of both parties to the loan agreement

The lender can be a non-bank institution or a natural person . In both cases, it is necessary to indicate this party to the contract, i.e. provide the full name, address and NIP, KRS or REGON number in the case of the company and names, date of birth, address of residence, series and ID card number and / or PESEL in the case of a natural person .


How are the loan costs regulated ?

loan cost

The loan agreement primarily defines its subject matter. The subject will usually be a specific amount of money transferred to the borrower who undertakes to return it within a specified period and amount.

Contractual loan companies draw up a detailed description of costs in the table. There you will find information about the total loan amount, currency, commission, total loan cost, interest and APRC. An additional element for the borrower is the so-called The Information Card, where you will find the above information repeated in a transparent form, as well as the Table of Fees and Commissions and the Model declaration on withdrawal from the Agreement.


Loan agreement – other important elements

Loan agreement - other important elements

Separate points should be provisions on the terms and dates of repayment of the loan. By signing the document, the Borrower undertakes to repay the loan on the terms specified in the contract and in accordance with the repayment schedule. Elements such as the number of installments, the amount of installments, repayment dates, information about the extension of the loan and the rules of this procedure are also important information contained in the contract.

In addition, the clause regarding withdrawal from the loan agreement and the consequences of such withdrawal is obligatory. It is good to remember that according to the law, we have the option of withdrawing from the loan agreement within 14 days of its conclusion.

As you can see, a well-structured loan agreement provides you with all the necessary information about the loan. You will find information on it such as:

  • between whom the contract is concluded,
  • when and where it was signed,
  • what is its subject,
  • What are the specific conditions for both parties?
  • whether the borrower is able to assume such financial commitment,
  • how the loan value should be repaid.

If you borrow money from a private individual, the contract can be very simple. It is worth remembering to write it down at $ 500, although the law requires a written contract from $ 1,000. If you are borrowing from a loan company, please read the agreement exactly and ask your advisors if something raises your doubts.

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