LOAN AGREEMENT

(As per the Indian Contract Act, 1872 & Other Applicable Laws)

This Loan Agreement is made and entered into on [Date], at [Place], by and between:

1. Lender: [Lender’s Full Name], a [individual/company/bank/financial institution] registered under [Applicable Law], having its registered office at [Address] (hereinafter referred to as the “Lender”).
2. Borrower: [Borrower’s Full Name], a [individual/company] registered under [Applicable Law], having its address at [Address] (hereinafter referred to as the “Borrower”).

(The Lender and Borrower shall be collectively referred to as “Parties” and individually as “Party”).

1. LOAN DETAILS

1.1 The Lender agrees to provide a loan of ₹[Amount] (Rupees [Amount in Words]) to the Borrower.
1.2 Loan Purpose: [Mention purpose, e.g., Business, Personal, Education, Home Loan, Vehicle Loan, etc.].
1.3 The loan shall be disbursed on [Date] via [Bank Transfer/Cheque/DD].
1.4 Loan Duration: The Borrower agrees to repay the loan within [Number] months/years from the disbursement date.

2. INTEREST RATE & REPAYMENT TERMS

2.1 The loan shall carry an interest rate of [Rate]% per annum, calculated on a [Simple/Compound] basis.
2.2 The Borrower agrees to repay the loan as per the following schedule:

2.3 The Borrower shall make payments via [NEFT/RTGS/Cheque/DD] to the Lender’s bank account [Bank Details].
2.4 If the Borrower fails to make timely payments, a late payment penalty of [Percentage]% per month shall be applicable.

3. SECURITY & COLLATERAL (IF APPLICABLE)

3.1 The loan is [Secured/Unsecured].
3.2 If secured, the Borrower agrees to provide the following collateral/security:

• Asset Type: [Property, Vehicle, Fixed Deposit, etc.]
• Description: [Details of the asset]
• Ownership Proof: [Attach legal documents]
  3.3 The Lender retains the right to seize and sell the collateral in case of loan default.

4. RIGHTS & OBLIGATIONS OF THE PARTIES

4.1 Lender’s Rights & Obligations:

• Provide the agreed loan amount in a timely manner.
• Charge interest and penalties as per the agreement.
• Take legal action if the Borrower defaults on repayment.

4.2 Borrower’s Rights & Obligations:

• Use the loan only for the agreed purpose.
• Repay the loan as per the agreed schedule and terms.
• Inform the Lender about any financial difficulties affecting repayment.

5. PREPAYMENT & LOAN CLOSURE

5.1 The Borrower may prepay the loan before the agreed term without any penalty [OR] with a penalty of [Percentage]%.
5.2 Upon full repayment, the Lender shall issue a “No Dues Certificate” to the Borrower.

6. DEFAULT & CONSEQUENCES

6.1 The Borrower shall be considered in default if:

• Fails to pay three or more consecutive installments.
• Declares bankruptcy or insolvency.
• Provides false information in the loan application.
  6.2 In case of default, the Lender has the right to:
• Seize and sell collateral (if applicable).
• Take legal action for loan recovery.
• Report the default to credit bureaus (CIBIL, etc.).

7. INDEMNITY & LIABILITY

7.1 The Borrower agrees to indemnify the Lender against any losses or legal claims arising due to default.
7.2 The Lender shall not be liable for any indirect or consequential damages suffered by the Borrower.

8. FORCE MAJEURE

Neither party shall be held liable for delays due to natural disasters, war, government actions, or other unforeseen events.

9. DISPUTE RESOLUTION & GOVERNING LAW

9.1 Any disputes arising under this contract shall first be attempted to be resolved through negotiation.
9.2 If unresolved, disputes shall be settled through arbitration under the Arbitration and Conciliation Act, 1996.
9.3 The courts of [City] shall have exclusive jurisdiction, and this agreement shall be governed by Indian law.

10. GENERAL CLAUSES

10.1 Entire Agreement: This agreement represents the entire understanding between the parties.
10.2 Amendments: Any changes must be in writing and signed by both parties.
10.3 Severability: If any clause is found invalid, the remaining provisions shall still be enforceable.

IN WITNESS WHEREOF

The parties have read, understood, and agreed to the terms and conditions set forth in this Agreement and have signed below:

For Lender
Signature: _______________
Name: ___________________
Designation: _____________
Date: _______________

For Borrower
Signature: _______________
Name: ___________________
Aadhar/PAN No.: __________
Date: _______________

Witness 1
Signature: _______________
Name: ___________________
Address: ________________

Witness 2
Signature: _______________
Name: ___________________
Address: ________________

This Loan Agreement ensures legal clarity, enforceability, and protection for both Lender and Borrower.