If you`re looking for a free sample loan agreement between friends in the UK, you`ve come to the right place. When it comes to loaning money to friends, it`s always a good idea to put the terms in writing to avoid misunderstandings and maintain the relationship. In this article, we`ll provide you with a free sample loan agreement between friends in the UK.

Before we dive into the sample agreement, here are a few things to keep in mind:

1. Make sure you`re comfortable with the amount you`re loaning. Only lend what you can afford to lose.

2. Agree on a reasonable interest rate. It`s not uncommon for friends to lend money interest-free, but if you`re charging interest, make sure it`s reasonable and agreed upon by both parties.

3. Specify the terms of repayment. Will the loan be repaid in a lump sum or in installments? When is the first payment due? Be clear about the repayment schedule.

4. Discuss the consequences of non-payment. It`s important to have a plan in place in case the borrower is unable to repay the loan. Will there be additional fees or interest charged? Will legal action be taken?

Now that you`re aware of a few things to keep in mind, here`s a free sample loan agreement between friends in the UK:

LOAN AGREEMENT BETWEEN FRIENDS

This Loan Agreement (“Agreement”) is entered into as of [date] by and between [Lender name], with an address at [address], (“Lender”), and [Borrower name], with an address at [address], (“Borrower”).

1. Loan Amount

Lender agrees to loan Borrower the sum of [loan amount] pounds (£[loan amount]), to be paid back in instalments over [number of months/years] months/years.

2. Interest Rate

The interest rate for this loan will be [interest rate] percent (%), to be calculated on the outstanding principal balance of the loan.

3. Repayment Schedule

The loan will be repaid in [number of equal instalments] equal instalments of [instalment amount] pounds (£[instalment amount]) on the [due date for each instalment] of each month. The first payment will be due on [due date for first instalment]. Borrower will make the payments to Lender at [address for payments].

4. Late Payments

If Borrower is late in making any payment(s), Borrower shall pay Lender a late fee of [late fee amount] pounds (£[late fee amount]).

5. Default

If Borrower fails to make a payment or violates any other terms of this Agreement, Lender has the right to demand immediate payment of the entire outstanding balance. In the event of default, Borrower shall pay Lender all reasonable costs of collection, including attorney`s fees.

6. Governing Law

This Agreement shall be governed by and construed in accordance with the laws of [country and state], and any applicable federal laws.

7. Entire Agreement

This Agreement contains the entire understanding of the parties and supersedes all prior negotiations, understandings, and agreements between the parties.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

[Lender’s signature]

[Borrower’s signature]

In conclusion, lending money to friends can be a tricky situation, so it`s important to have a written agreement in place. Use this free sample loan agreement between friends in the UK as a guide to create your own agreement that works best for your unique circumstances.