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FinanceIndiaStandard Verified Compliance Template

Free Loan Agreement Template Template

Free Loan Agreement template for India. Define principal, interest, repayment terms, and security. Pro-grade boilerplate vetted by certified domain experts. Use it as a raw document, or automate it in Glomiq to eliminate manual copy-pasting.

Verified Compliance Document
Vetted by: Ashay Shah
GLOMIQ DRAFT
LOAN AGREEMENT
This Loan Agreement ("Agreement") is executed on [DATE] at [CITY] by and between:
[LENDER_NAME], a [citizen of India/registered entity], residing/situated at [LENDER_ADDRESS] (hereinafter called the "Lender"), AND [BORROWER_NAME], a [citizen of India/registered entity], residing/situated at [BORROWER_ADDRESS] (hereinafter called the "Borrower").
WHEREAS the Lender has agreed to lend a sum of money to the Borrower, and the Borrower has agreed to repay the same along with interest as per the terms and conditions hereinafter mentioned.
1. LOAN AMOUNT AND PURPOSE. The Lender hereby agrees to lend to the Borrower a sum of ₹[PRINCIPAL_AMOUNT] (Rupees [AMOUNT_IN_WORDS]) only (hereinafter referred to as the "Loan Amount"). The Borrower shall utilize this loan amount for [PURPOSE_OF_LOAN] only.
2. INTEREST. The Borrower shall pay interest on the outstanding Loan Amount at the rate of [INTEREST_RATE]% per annum, calculated on a [daily/monthly/quarterly] basis.
3. DISBURSEMENT. The Lender shall disburse the Loan Amount to the Borrower on [DISBURSEMENT_DATE] as follows: [DISBURSEMENT_SCHEDULE].
4. REPAYMENT TERMS. The Borrower shall repay the Loan Amount in [NUMBER_OF_INSTALLMENTS] equal monthly installments of ₹[INSTALLMENT_AMOUNT] each, commencing from [FIRST_REPAYMENT_DATE]. The final installment shall be paid by [FINAL_REPAYMENT_DATE].
5. SECURITY. As security for the repayment of the Loan Amount, the Borrower shall provide:
[DESCRIPTION_OF_COLLATERAL/MORTGAGE/PLEDGE]
6. DEFAULT. If the Borrower fails to pay any installment within [GRACE_PERIOD] days of the due date, interest at [PENAL_RATE]% per annum shall be charged on the overdue amount.
7. PREPAYMENT. The Borrower may repay the entire outstanding Loan Amount at any time without penalty.
8. COVENANT. The Borrower covenants to maintain the security in good condition and not dispose of it without the Lender's written consent.
[LENDER_NAME]
Signature: ______________________
[BORROWER_NAME]
Signature: ______________________
WITNESSES:
1. Name: _________________ Signature: _________________
2. Name: _________________ Signature: _________________

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Expert Drafting Guide & Clause Commentary

Compiled by Ashay Shah. Critical checkpoints before finalizing this document.

1Standard Terms and Definitions▼
Clause Context:

Defines the main terms used throughout the document.

Negotiating Tip:

Ensure definitions are consistently used across all sections to avoid conflicting interpretations.

2Governing Law and Jurisdiction▼
Clause Context:

Determines which courts will settle disputes.

Negotiating Tip:

Set the governing law to your local jurisdiction to minimize travel and legal overhead in the event of a dispute.

Compliance Watchouts

  • Review all placeholders carefully before signing.
  • Consult a professional advisor if editing core clauses.
A

Ashay Shah (Founder, Glomiq)

Ashay is the founder of Glomiq. He is passionate about reducing administrative overhead for Indian professionals. Prior to Glomiq, Ashay spent 6 years leading engineering and product teams building automated document infrastructure and SaaS systems.

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