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Loan Agreement Template — Complete Loan Contract

Comprehensive loan agreement with covenants, representations, and remedies. $9.99 instant PDF.

A loan agreement is the full contract that governs a lending relationship — substantially more detailed and protective than a simple promissory note. While a promissory note is essentially a one-page IOU containing the borrower's promise to repay, a loan agreement adds binding representations and warranties, affirmative and negative covenants (restrictions on what the borrower may do during the loan), detailed conditions precedent to funding, events of default, and lender remedies including acceleration. This template is the right choice for larger or more complex loans — business loans over $25,000, real estate financing, inter-company advances, secured lending, and founder loans to a startup — where the lender needs ongoing control and stronger enforcement rights. Delivered as a clean, attorney-drafted PDF ready to execute.

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Why StubFast?

  • Covenants section restricts the borrower from taking on additional debt, selling assets, or paying dividends without lender consent — protection a promissory note cannot give you
  • Representations and warranties shift legal risk to the borrower if they misstated their financial condition or authority to borrow
  • Events of default and acceleration clause let the lender call the entire balance due immediately on breach, not just on a missed payment
  • Conditions precedent ensure the loan only funds once required documents, insurance, and collateral are in place
  • Clean, attorney-drafted PDF — one-time $9.99 payment, no subscription, no per-document upcharges

Common Use Cases

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    Business loan from an investor, family office, or private lender to a company for working capital or expansion
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    Real estate purchase or refinance loan secured by a property, where the lender needs covenants protecting the collateral
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    Inter-company loan between a parent entity and its subsidiary, or between two affiliated companies under common ownership
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    Founder loan to a startup — when an owner advances cash to their own company and wants formal repayment terms on the books
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    Friend-or-family loan above $25,000 where the parties want the full enforceability of a true commercial agreement, not just a handshake IOU
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    Bridge or mezzanine financing where the lender requires detailed covenants on financial ratios, reporting, and use of proceeds

What is a Loan Agreement?

A loan agreement is the full commercial contract that governs a lending relationship. It is substantially more detailed than a one-page promissory note, adding binding representations and warranties about the borrower's financial condition, affirmative and negative covenants that restrict the borrower's behavior during the loan, conditions precedent that must be satisfied before funding, detailed events of default, and lender remedies that include acceleration of the entire balance.

When You Need a Loan Agreement (Not Just a Promissory Note)

For loans under $25,000 between friends or family, a promissory note is usually enough. But for larger or more complex loans — business loans, real estate financing, inter-company advances, founder loans to a startup — you need the broader protection of a full loan agreement. The covenants alone are often worth more than the collateral: they let the lender block dividends, additional debt, or asset sales until the loan is repaid.

Key Sections in a Loan Agreement

A complete loan agreement includes the loan terms (principal, rate, schedule), conditions precedent (insurance, opinion letters, UCC filings), representations and warranties (the borrower's authority and financial state), covenants (what the borrower may and may not do), events of default (missed payments, insolvency, covenant breach), and remedies (acceleration, collateral seizure, attorneys' fees). Our generator builds each of these sections from your inputs.

Secured vs. Unsecured Loan Agreements

An unsecured loan agreement relies entirely on the borrower's creditworthiness and the strength of the covenants. A secured loan agreement adds collateral — equipment, real estate, accounts receivable, or all assets of the business — that the lender can seize on default. For secured loans, you will typically also file a UCC-1 financing statement to perfect the security interest; our generator outputs the loan agreement and notes the additional filings you will need.

How to Use This Generator

Fill in the lender, borrower, loan terms, and chosen covenants. Pick secured or unsecured. Set the events of default and any cure periods. Preview the full agreement, then download the clean PDF for $9.99. Have counsel review for very large transactions, but the template gives you a professional, defensible starting point — not a basic IOU.

Frequently Asked Questions

What's the difference between a loan agreement and a promissory note?▼
A promissory note is a short, one-sided written promise from the Borrower to repay a debt — it covers principal, interest, payment schedule, and default. A loan agreement is the full bilateral contract that also includes representations and warranties, covenants restricting the Borrower's conduct during the loan, conditions precedent to funding, detailed events of default, and lender remedies including acceleration. Use a promissory note for small, simple loans between known parties. Use a loan agreement whenever the amount is significant, the loan is secured, or the lender needs ongoing control over the Borrower's behavior.
When should I use a loan agreement instead of a promissory note?▼
Use a loan agreement for loans over roughly $25,000, any loan secured by collateral, any loan to a business entity, inter-company advances, loans that will be on the books for more than 12 months, and any situation where the lender needs covenants like restrictions on additional debt, financial reporting, or limits on dividends and asset sales. If you are an investor lending to a company, almost always use a loan agreement.
What are loan covenants and why do they matter?▼
Covenants are binding promises the Borrower makes about its conduct during the loan term. Affirmative covenants require action — pay taxes, maintain insurance, deliver financial statements. Negative covenants prohibit action — no additional debt, no asset sales, no dividends, no mergers without consent. They matter because a covenant breach is itself an event of default, allowing the lender to accelerate the loan and demand immediate repayment even if no payment has been missed. This gives the lender enforcement leverage long before the Borrower runs out of cash.
Does a loan agreement need to be notarized?▼
A loan agreement does not legally require notarization to be enforceable — it is binding once signed by both parties. However, we strongly recommend notarization for loan agreements because it (1) eliminates disputes about whether the signatures are authentic, (2) is often required by the county recorder if you also record a security interest in real estate, and (3) is required for UCC filings in some jurisdictions. Our template is built to be notarized.
What interest rate can I legally charge under a loan agreement?▼
Maximum allowable interest rates (usury caps) are set by each state. Most states cap consumer loan rates between 8% and 25% APR. Commercial loans to a business entity are usually exempt from usury caps or have much higher ceilings — in many states, business-purpose loans have no statutory cap at all. We pull in your state's usury rules and flag the rate if it appears excessive. When in doubt, structure the loan as a business loan to a corporate Borrower.
What happens if the borrower defaults on a loan agreement?▼
On an event of default — missed payment beyond the grace period, covenant breach, false representation, insolvency, or any other listed default — the Lender can (1) accelerate the loan, meaning the entire unpaid principal and interest becomes immediately due, (2) charge default interest at the higher default rate, (3) foreclose on any collateral securing the loan, (4) pursue any personal guarantor, and (5) sue for collection plus attorney's fees if the agreement includes a fee-shifting clause. Acceleration is the lender's most powerful remedy and is built into this template.

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