If you are executing your loan agreement, you may be interested in the fact that a notary can certify it notarized once all parties have signed or you want to include witnesses. The advantage of the inclusion of a notary is that it will help prove the validity of the document, if it is ever challenged. A witness is an alternative to notarizing the document if you do not have access to a notary; However, if possible, you should always try to include both. Once you have information about who is involved in the loan agreement, you must describe the details of the loan, including transaction information, payment information and interest rate information. In the transaction section, you indicate the exact amount owed to the lender after the agreement is executed. The amount does not include interest over the life of the loan. They will also detail what the borrower must pay in return for the amount of money they promise to pay to the lender. In the “Payment” section, you`ll find out how the loan amount is repaid, how payments are made (p.B monthly payments, on demand, a lump sum, etc.) and information on acceptable payment methods (p. B for example, cash, credit card, payment order, bank transfer, debit payment, etc.).
You must include exactly what you accept as a means of payment, so that no questions are allowed about payment methods. The categorization of loan contracts by type of facility generally results in two main categories: representations and guarantees are similar in all facility agreements. They focus on the borrower`s legal capacity to enter into financing agreements and the nature of the borrower`s activity. They will often be broad and the borrower may try to limit them to issues that, if not correct, would have a significant negative effect. This qualification may apply to a large number of insurance and guarantees relating to the borrower`s activities (for example. B litigation, environmental and accounting matters), but will probably not be acceptable to the lender in order to limit the borrower`s ability to enter into financing agreements or with respect to important financial information. In the area of interests, insert information for any interest. If you don`t calculate interest, you don`t need to include this section.
However, if you are, you must specify when the interest on the loan will be collected and whether the interest will be simple or assembled. Simple interest is calculated on the principal unpaid, while compound interest is calculated on unpaid principal and any unpaid interest. Another aspect of interest you need to have in detail is whether you have a fixed or variable interest rate.