PERSONAL LOAN AGREEMENT

[Clean Draft – Ready for Attorney Customization]

TABLE OF CONTENTS

1. Document Header
2. Definitions
3. Operative Provisions
4. Representations & Warranties
5. Covenants & Restrictions
6. Default & Remedies
7. Risk Allocation
8. Dispute Resolution
9. General Provisions
10. Execution Block

1. DOCUMENT HEADER

Personal Loan Agreement
This Personal Loan Agreement (this “Agreement”) is entered into as of [EFFECTIVE DATE] (the “Effective Date”), by and between:

1. [LENDER LEGAL NAME], a [STATE OF FORMATION] [ENTITY TYPE / “individual”], having a principal address at [LENDER ADDRESS] (“Lender”); and
2. [BORROWER LEGAL NAME], a [STATE OF FORMATION] [ENTITY TYPE / “individual”], having a principal address at [BORROWER ADDRESS] (“Borrower,” and together with Lender, the “Parties,” and each a “Party”).

Recitals
A. Borrower has requested that Lender extend a personal loan in the principal amount of [LOAN AMOUNT] USD (the “Loan”).
B. Lender is willing to extend the Loan subject to the terms and conditions set forth herein.
C. The Parties desire to evidence the Loan, and their respective rights and obligations, in this written Agreement.

NOW, THEREFORE, in consideration of the mutual promises herein and other good and valuable consideration, the receipt and sufficiency of which are acknowledged, the Parties agree as follows:

[// GUIDANCE: Insert state-specific consumer disclosure statement immediately after this sentence if required under the selected governing state’s consumer protection law.]

2. DEFINITIONS

For purposes of this Agreement, capitalized terms shall have the meanings set forth below. Any term not defined herein shall have its commonly accepted meaning in commercial practice.

“Applicable Law” means all federal, state, and local statutes, regulations, and ordinances, including without limitation the [GOVERNING STATE] consumer protection statutes, and, where applicable, the federal Truth in Lending Act, 15 U.S.C. §§ 1601 et seq.

“Business Day” means any day other than a Saturday, Sunday, or legal holiday in [GOVERNING STATE] on which banks are open for commercial business.

“Event of Default” has the meaning assigned in Section 6.1.

“Final Maturity Date” means [MATURITY DATE], or such earlier date as the Loan may become due pursuant to this Agreement.

“Indemnified Parties” has the meaning assigned in Section 7.1.

“Loan Documents” means this Agreement, any promissory note issued hereunder, any security or guaranty documents (if applicable), and each other instrument or agreement executed in connection with the Loan.

“Outstanding Balance” means, at any time, the sum of (i) the then-unpaid principal of the Loan, plus (ii) all accrued but unpaid interest, fees, costs, and other amounts owing under the Loan Documents.

“Permitted Prepayment” has the meaning assigned in Section 3.5.

3. OPERATIVE PROVISIONS

3.1 Loan; Disbursement. Subject to the terms herein, Lender agrees to lend to Borrower the principal sum of [LOAN AMOUNT] USD on the Effective Date by wire transfer or other immediately available funds to an account designated by Borrower.

3.2 Interest.
(a) Rate. The Outstanding Balance shall accrue interest at the fixed rate of [ANNUAL INTEREST RATE]% per annum, calculated on the basis of a 365-day year and the actual number of days elapsed.
(b) Usury Savings. Notwithstanding any provision herein, interest shall not exceed the maximum lawful rate under Applicable Law, and any excess shall be automatically credited to principal.

3.3 Payment Schedule. Borrower shall make [MONTHLY / QUARTERLY] payments of principal and accrued interest in the amount of [PAYMENT AMOUNT] USD commencing on [FIRST PAYMENT DATE], and continuing on each Payment Date thereafter until the Final Maturity Date, when all remaining amounts shall be due and payable in full.

3.4 Use of Proceeds. Borrower shall apply the Loan proceeds solely for [SPECIFY PURPOSE / “lawful personal purposes”] and not for any unlawful or high-risk activities.

3.5 Prepayment. Borrower may, at any time and from time to time, prepay the Outstanding Balance in whole or in part without penalty (each, a “Permitted Prepayment”); provided that any partial prepayment shall be applied first to accrued interest and then to principal.

3.6 Conditions Precedent. Lender’s obligation to fund the Loan is conditioned upon (a) execution and delivery of all Loan Documents, (b) receipt of any collateral or guaranty required under Section 5.2, and (c) completion of all disclosures mandated by Applicable Law.

4. REPRESENTATIONS & WARRANTIES

Borrower represents and warrants to Lender as of the Effective Date and on each date the Outstanding Balance remains unpaid:

4.1 Existence; Authority. Borrower is duly organized, validly existing, and in good standing under the laws of its jurisdiction of formation (or, if an individual, is of legal age and capacity). Borrower has full power and authority to execute, deliver, and perform the Loan Documents.

4.2 No Conflict. The execution, delivery, and performance of the Loan Documents do not violate any charter document, contract, judgment, or Applicable Law binding upon Borrower.

4.3 Enforceability. Each Loan Document constitutes the legal, valid, and binding obligation of Borrower, enforceable in accordance with its terms.

4.4 Financial Condition. All financial and other information provided to Lender is true, correct, and complete in all material respects. Borrower is able to pay its debts as they become due.

4.5 Litigation. No litigation, arbitration, or administrative proceeding is pending or, to Borrower’s knowledge, threatened, that could reasonably be expected to have a material adverse effect on Borrower’s ability to perform its obligations.

[// GUIDANCE: Add any additional reps specific to collateral or guarantors, if used.]

5. COVENANTS & RESTRICTIONS

5.1 Affirmative Covenants. Until the Outstanding Balance is paid in full, Borrower shall:
(a) Timely Payments. Pay all amounts due under the Loan Documents in the manner and at the times specified.
(b) Compliance with Law. Comply in all material respects with Applicable Law, including consumer lending regulations, anti-money laundering statutes, and economic sanctions.
(c) Notice of Defaults. Promptly give written notice to Lender of any Event of Default or event that, with notice or lapse of time, would become an Event of Default.

5.2 Negative Covenants. Borrower shall not, without Lender’s prior written consent:
(a) Transfer. Sell, assign, or otherwise transfer any material portion of its assets outside the ordinary course of business (or, if an individual, dispose of substantially all personal assets) if such action would impair repayment ability.
(b) Additional Debt. Incur additional indebtedness senior to or pari passu with the Loan that would materially impair Borrower’s ability to repay the Loan.
(c) Prohibited Use. Use Loan proceeds for any illegal purpose or to fund any gambling, controlled-substance transactions, or other illicit activities.

[// GUIDANCE: Insert collateral-specific covenants (e.g., perfection of security interests) if the Loan is secured.]

6. DEFAULT & REMEDIES

6.1 Events of Default. Each of the following constitutes an “Event of Default”:
(a) Payment Default. Borrower fails to pay any amount due within [NUMBER] days after its due date.
(b) Breach of Covenants. Borrower breaches any covenant, representation, or warranty and fails to cure within [CURE PERIOD] days after written notice.
(c) Insolvency. Borrower becomes insolvent, makes an assignment for the benefit of creditors, or is subject to any bankruptcy or similar proceeding.
(d) Cross-Default. Any default occurs under any other agreement between Borrower and Lender.

6.2 Remedies. Upon the occurrence and during the continuance of an Event of Default, Lender may, at its option and without prejudice to any other rights, exercise any or all of the following:
(a) Acceleration. Declare the Outstanding Balance immediately due and payable.
(b) Late Charges. Impose a late fee of [LATE FEE]% of the overdue amount for each payment period or portion thereof that such amount remains unpaid (subject to Applicable Law).
(c) Collection Costs. Recover all reasonable costs of collection, including attorneys’ fees, court costs, and expenses.
(d) [Limited Injunctive Relief. Seek injunctive or equitable relief solely to prevent dissipation of collateral or to enforce confidentiality obligations.]

[// GUIDANCE: If collateral is pledged, include detailed foreclosure and UCC Article 9 remedies.]

7. RISK ALLOCATION

7.1 Indemnification by Borrower. Borrower shall indemnify, defend, and hold harmless Lender and its officers, directors, employees, and agents (collectively, the “Indemnified Parties”) from and against any and all losses, claims, damages, liabilities, and expenses (including reasonable attorneys’ fees) arising out of or relating to (a) Borrower’s breach of any Loan Document, or (b) Borrower’s misuse of Loan proceeds, in each case not to exceed the aggregate Loan Amount, except in cases of Lender’s gross negligence or willful misconduct.

7.2 Limitation of Liability. Except for (i) Borrower’s payment and indemnity obligations and (ii) liabilities arising from either Party’s fraud, gross negligence, or willful misconduct, the maximum aggregate liability of either Party under or in connection with the Loan Documents shall not exceed the Loan Amount.

7.3 Force Majeure. Neither Party shall be liable for delay or failure in performance due to events beyond its reasonable control, including acts of God, war, terrorism, pandemic, or government action, provided that the affected Party gives prompt notice and resumes performance as soon as practicable.

8. DISPUTE RESOLUTION

8.1 Governing Law. This Agreement and any dispute arising hereunder shall be governed by and construed in accordance with the laws of [GOVERNING STATE], without regard to its conflict-of-law rules, and in conformity with applicable federal consumer protection requirements.

8.2 Forum Selection. The Parties irrevocably submit to the exclusive jurisdiction of the state courts located in [COUNTY, GOVERNING STATE] (and, if jurisdiction is proper, the corresponding federal courts) for the purpose of any suit, action, or proceeding arising out of or relating to the Loan Documents.

8.3 Arbitration (Optional).
[OPTION A – Include]
“Any dispute, claim, or controversy arising out of or relating to the Loan Documents shall be resolved exclusively by binding arbitration administered by [ARBITRATION ORGANIZATION] under its [RULES] in effect at the time of filing, and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction.”
[OPTION B – Strike if not desired.]

8.4 Jury Trial Waiver (Optional).
[OPTION A – Include]
“EACH PARTY HEREBY KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVES ANY RIGHT TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION BASED HEREON.”
[OPTION B – Strike if not desired.]

8.5 Limited Injunctive Relief. Nothing herein shall preclude a Party from seeking temporary, limited injunctive relief in a court of competent jurisdiction to (a) maintain the status quo pending arbitration or litigation, or (b) prevent irreparable harm not compensable in damages; provided, however, that such relief shall not extend beyond what is necessary and shall not waive any obligation to arbitrate if Section 8.3 is in effect.

9. GENERAL PROVISIONS

9.1 Amendments; Waivers. No amendment, modification, or waiver of any provision of a Loan Document shall be effective unless in writing and signed by both Parties. A waiver on one occasion shall not constitute a waiver on any subsequent occasion.

9.2 Assignment. Borrower may not assign or delegate its rights or obligations without Lender’s prior written consent. Lender may assign its rights, in whole or in part, subject to Applicable Law and any required consumer notice.

9.3 Successors and Assigns. The Loan Documents shall bind and inure to the benefit of the Parties and their respective permitted successors and assigns.

9.4 Severability. If any provision is held invalid or unenforceable, such provision shall be reformed to the minimum extent necessary, and the remaining provisions shall remain in full force and effect.

9.5 Entire Agreement. The Loan Documents constitute the entire agreement between the Parties with respect to the subject matter and supersede all prior oral or written agreements.

9.6 Counterparts; Electronic Signatures. The Loan Documents may be executed in counterparts (including by electronic means), each of which shall be deemed an original and all of which together shall constitute one instrument. Electronic signatures shall be deemed to have the same legal effect as original signatures to the fullest extent permitted by Applicable Law, including the federal Electronic Signatures in Global and National Commerce Act, 15 U.S.C. § 7001.

9.7 Notices. Any notice or other communication required or permitted shall be in writing and deemed given when delivered (i) by hand with receipt, (ii) by nationally recognized overnight courier, or (iii) by certified mail, return receipt requested, to the addresses first set forth above, or to such other address as a Party may designate by notice.

10. EXECUTION BLOCK

IN WITNESS WHEREOF, the Parties hereto have executed this Personal Loan Agreement as of the Effective Date.

[Notary Acknowledgment – Include if required under [GOVERNING STATE] law]

[// GUIDANCE: Prior to execution, review state-specific consumer lending statutes for (1) mandatory disclosures (e.g., finance charge, APR), (2) notice of right to rescind (if applicable), and (3) usury thresholds. Replace bracketed placeholders, confirm interest-rate and late-fee compliance, and insert an amortization schedule or truth-in-lending disclosure as a separate exhibit if required.]