Borrowing Money From A Friend Contract Template

A money agreement is a binding contract between two parties agreeing to several and specific conditions that relate to money acquired or given which is beneficial for both individuals or businesses.

Borrowing money from a friend contract template. Money is a funny thing when it passes between family and friends especially if you are the one borrowing from or lending to a member of your family or a close friend. This sample contract to borrow money from a friend can be used by anyone that is looking for a loan from an acquaintance but feels the need to make it fully legit and legal. Moreover the written agreement makes it possible for the payee to prove that the promisor had a well defined payment plan and that they did not comply with the. If you must borrow money from a friend it s best to put your friendship aside and simply think of it as a business deal among friends and draft an official money loaning agreement with all the details that surround the transaction. This guide outlines the options available.

Money will always come and go but once a friendship is destroyed sometimes it s gone forever. In other words it must be clearly represented as a legal loan agreement letter. This is actually a really good idea for both the lender and the borrower since money has a tendency to split friendships and break up families when not paid back or one. The promisor the friend borrowing the money receives the assurance that the payee the friend loaning the money will not claim that the loan was actually for a much larger amount. Therefore if you re borrowing from or lending money to a friend think about your relationship first.

Refer your friend or family member to our debt help guide if it s a major debt issue small loans from friends or family members won t help. Sample contract when loaning money to a friend in order to help minimize conflict this 2 page contract directly addresses several possible issues that might arise. The borrower promises to pay back the loan in line with a repayment schedule regular payments or a lump sum. Loaning money can sometimes be the culprit behind a dissolving friendship between two friends. It is usually better to put all matters that have been agreed upon in writing with signatures of the parties involved than trusting words in a deal.

According to the federal reserve board survey of consumer finances loans from family and friends amount to 89 billion each year in the united states. Sample loan agreement letter between friends. As a lender this document is very useful as it legally enforces the borrower to repay the loan. This agreement can also apply to lending money to close friends with an aim of getting back your money with an interest after a certain duration of time. Some of the areas covered are missed payments late payments and early repayment.