Simple Loan Agreement Letter

[Borrower’s Name] [Borrower’s Address] [City, State, ZIP Code] [Email Address] [Phone Number]

Subject: Loan Agreement

Dear [Borrower’s Name],

This letter serves as a formal agreement between [Your Name] (Lender) and [Borrower’s Name] (Borrower) regarding the loan of [Loan Amount] to be provided by the Lender to the Borrower.

Loan Amount and Disbursement: The Lender agrees to loan the Borrower the total amount of [Loan Amount] under the terms specified in this agreement. The loan amount will be disbursed to the Borrower on [Disbursement Date].

Repayment Terms: The Borrower agrees to repay the loan amount in full by [Repayment Date]. The repayment schedule is as follows:

• Installment Amount: [Amount]
• Due Date: [Date of Each Installment]

Interest Rate: An annual interest rate of [Interest Rate]% will be applied to the outstanding balance of the loan. Interest will be calculated monthly and added to the total amount due.

Late Fees: If any installment is not paid by the due date, a late fee of [Late Fee Amount] will be charged for each missed payment. The Borrower will also be responsible for any additional costs incurred due to the delay.

Prepayment: The Borrower may prepay the loan amount in full or in part at any time without penalty. Prepayments will be applied first to accrued interest and then to the principal balance.

Default: In the event of default, where the Borrower fails to make payments as agreed, the Lender reserves the right to take legal action to recover the outstanding loan amount, including interest and late fees.

Governing Law: This loan agreement will be governed by and construed in accordance with the laws of [State/Country].

Signatures: By signing below, both parties agree to the terms and conditions outlined in this loan agreement.

[Lender’s Signature]
[Your Name]

[Borrower’s Signature]
[Borrower’s Name]

Please sign and return a copy of this agreement to indicate your acceptance of the terms.

Sincerely,

[Your Name]
[Your Position/Title, if applicable]

Attachments:

• Copy of Identification (if applicable)
• Proof of Loan Amount (if applicable)

Thank you for your prompt attention to this matter.

Sincerely,

[Your Name]