Sample Loan Disclosure Statement

A loan disclosure statement is a critical document that outlines the terms and conditions of a loan agreement between a borrower and a lender. This document is essential for ensuring transparency and protecting the rights of both parties involved. Here is a detailed sample of a loan disclosure statement, designed to provide clarity and thoroughness in understanding the financial commitment.

1. Loan Overview:
The loan overview section provides a summary of the key terms of the loan. This includes the amount borrowed, the interest rate, the repayment term, and the type of loan.

Loan Amount: $25,000
Interest Rate: 5.5% per annum
Repayment Term: 5 years
Loan Type: Fixed-rate mortgage

2. Borrower Information:
This section includes the personal details of the borrower. It is important for verifying the identity and creditworthiness of the borrower.

Name: John Doe
Address: 123 Elm Street, Springfield, IL 62704
Social Security Number: 123-45-6789
Date of Birth: January 1, 1980

3. Lender Information:
The lender's details are provided here, including their name, address, and contact information.

Lender Name: ABC Bank
Address: 456 Oak Avenue, Springfield, IL 62704
Contact Number: (555) 123-4567
Email: [email protected]

4. Loan Terms and Conditions:
This section outlines the specific terms and conditions of the loan agreement, including the following:

• Principal Amount: The total amount of money borrowed.
• Interest Rate: The percentage charged on the principal amount, which may be fixed or variable.
• Repayment Schedule: The frequency and amount of payments, which could be monthly, quarterly, or annually.
• Late Fees: Penalties for late payments, typically a percentage of the overdue amount.
• Prepayment Penalties: Charges for paying off the loan early, if applicable.

5. Cost of the Loan:
The cost of the loan includes all fees and charges associated with borrowing. This can be broken down into:

• Origination Fees: Fees charged for processing the loan application.
• Closing Costs: Expenses incurred during the closing of the loan, such as appraisal fees, title insurance, and recording fees.
• Monthly Payments: The amount to be paid each month, including both principal and interest.

6. Amortization Schedule:
An amortization schedule details how the loan principal and interest are paid over time. It shows the breakdown of each payment into principal and interest portions and tracks the remaining balance of the loan.

Sample Amortization Schedule:

Payment No.	Payment Date	Principal Paid	Interest Paid	Remaining Balance
1	01/01/2025	$400	$112.50	$24,600
2	02/01/2025	$402	$110.00	$24,198
3	03/01/2025	$404	$107.50	$23,794

7. Additional Information:
This section includes any additional terms or provisions related to the loan, such as:

• Insurance Requirements: Any insurance that must be maintained, such as property insurance.
• Collateral: Assets pledged as security for the loan, if applicable.
• Default Consequences: The actions that will be taken if the borrower fails to meet their obligations.

8. Acknowledgment and Agreement:
The borrower is required to sign and date the disclosure statement, indicating that they have read, understood, and agreed to the terms outlined.

Borrower Signature: ______________________
Date: ______________________
Lender Signature: ______________________
Date: ______________________

9. Contact Information for Questions:
For any questions or clarifications regarding the loan, the borrower can contact the lender using the provided contact details.

Lender Contact Number: (555) 123-4567
Email: [email protected]

10. Disclaimer:
This loan disclosure statement is provided for informational purposes only. The actual terms and conditions of the loan may vary and are subject to change based on the final agreement between the borrower and lender.

Note: Ensure that you carefully review all terms and conditions before signing the loan agreement. If necessary, consult with a financial advisor or attorney to fully understand the implications of the loan.