Loan Agreement - Personal - Texas

PERSONAL LOAN AGREEMENT — TEXAS

Before you use this: This form is for one unsecured loan by a private lender to an individual for personal, family, or household use. A lender making loans as a business, a secured or real estate loan, or a transaction with fees needs separate licensing, disclosure, and interest review. This form permits a fixed annual rate from 0% to 10%, with no additional charges. Complete the payment schedule before signing.

This agreement is made on [__/__/____] between [LENDER FULL LEGAL NAME], of [LENDER ADDRESS] ("Lender"), and [BORROWER FULL LEGAL NAME], of [BORROWER ADDRESS] ("Borrower").

Loan and funding

Lender agrees to advance $[AMOUNT] to Borrower on [__/__/____] by [TRANSFER METHOD]. Borrower will use the funds for [PERSONAL, FAMILY, OR HOUSEHOLD PURPOSE]. This loan is unsecured. Lender will give Borrower written confirmation of the amount and date actually advanced. Borrower's repayment obligation begins when funds are advanced.

Interest and repayment

Interest accrues only on unpaid principal at [____]% annual simple interest (enter 0 for an interest-free loan; do not enter more than 10%) and does not compound. For each day, interest equals unpaid principal multiplied by the stated annual rate divided by 365 if that day is in a nonleap calendar year, or by 366 if that day is in a leap calendar year. Borrower will pay $[AMOUNT] first on [__/__/____] (choose a date after the advance from the 1st through the 28th), then on that same day of each following month until the final due date or earlier full payment. Each installment is limited to the unpaid principal and accrued interest then due. All unpaid principal and accrued interest are due on [__/__/____] (on or after the first scheduled payment date). Payments apply first to accrued interest, then to principal. Borrower may prepay all or part at any time without a charge; a partial prepayment does not postpone the next scheduled due date unless the parties sign a change.

Neither party may add an origination fee, late fee, default interest, or prepayment penalty under this agreement. The rate and payments written here are the entire consideration for making the loan.

Missed payment and collection

If a payment is more than [____] days late, Lender may give Borrower written notice of the missed amount. If Borrower does not pay it within [____] days after receiving the notice, Lender may declare the unpaid principal and accrued interest immediately due. Lender may pursue payment through lawful remedies, subject to applicable limitation periods and collection law. A default does not increase the agreed interest rate.

Notices and changes

Notices may be delivered personally or mailed to the addresses above, or to a replacement address given in writing. Changes to this agreement must be written and signed by both parties. Texas law governs this agreement. This is the parties' entire agreement for this advance.

Lender signature: ______________________________ Date: [__/__/____]
Printed name: [________________________________]

Borrower signature: ______________________________ Date: [__/__/____]
Printed name: [________________________________]

Texas law reference

Tex. Fin. Code § 302.001(b) generally sets a 10% annual interest maximum unless another law provides otherwise. This form stays within that rate and charges no separate lending fees or late charges. The ordinary debt limitation in Tex. Civ. Prac. & Rem. Code § 16.004(a)(3) is four years after accrual. A Texas judgment's interest rate is determined under Fin. Code § 304.002 when a contract provides for interest, or § 304.003 otherwise; it is not an extra contractual default charge.