Loan Agreement

Suitable For Use : NSW, QLD, VIC, WA, NT &  ACT

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Loan Agreement


This loan agreement can be used to record the terms and conditions of a loan made between individual persons or companies. This loan agreement can be used for a variety of different loan types.

Whether the loan is between friends and family or is a commercial loan between two businesses, this Loan Agreement makes it possible to provide a simple interest-free loan or charge interest, set a repayment schedule, and add guarantors.

As well as a personal loan a business owner  may well ask “why is a Loan Agreement important?” You will almost certainly want to understand the terms and complexities of your business loan agreement so that you or your legal team can negotiate with the lender to get the best possible deal for you.

How to use this document

This document should be read carefully by the parties who are going to sign it. Every party should then sign the Loan Agreement. Individuals should ensure that their signature of the document is witnessed by another adult person (over the age of 18) who is not named in the loan agreement.

Where a company is a party to this agreement they should ensure that the Loan Agreement is signed by two authorised signatories, either two directors or a director and a company secretary. Where a company only has a single director, that person may sign the agreement as the sole director.

Where the Lender has requested that the borrower provide guarantors, those guarantors should also carefully read the entire Loan Agreement and their guarantee obligations, and sign where indicated.

Applicable law

This agreement is subject to the general principles of contract law. It is suitable for individuals and companies who want a simple and straightforward record of their loan obligations it is not suitable for professional lenders such as finance companies and banks that are subject to more stringent consumer protection laws.

If a Lender is a company, and the Loan is being provided to a shareholder of that company, parties should be aware of division 7A of the Income Tax Assessment Act 1936 (Cth) and use an alternative agreement – the Division 7A Loan Agreement.

If in doubt, seek legal advice.

How to modify the template

The document is in Word formats. You can modify all parts of it and reuse it as many times as you like.


Loan Agreement 

Download this Loan Agreement Template for an agreement between a Lender and a Borrower. This template is a formal way of setting out the terms and conditions of the loan.

The Loan Agreement Template includes:-



    • 1.1 Definitions
    • 1.2 Interpretation
    • 2          Loan
    • 3          Interest
    • 4          Repayment
    • 5          Early repayment
    • 6          Guarantor guarantee/indemnity
    • 7          Cost
    • 1. the initial amount being borrowed
    • 2. how it is repaid
    • 3. any interest payable
    • 4. guarantors

    The lender may be a human or a company. The Borrower can be a human or a company.

    It is important that the Borrower fully understands the nature of what they are agreement sets out and the consequences of not repaying can be very serious and may be followed by debt collection


    A loan calculator that enables you to calculate the repayments and a repayment schedule for the loan. Simply enter the loan amount, interest rate, term, commencement date and our loan amortisation will calculate monthly repayment AND give you a schedule of all repayments over the life of the loan including the due dates!

    This Loan Agreement Template is 9 Pages



    Includes GST



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    Loan Agreement Template

    This precedent is a basic loan agreement. Loan transactions can be fairly simple or extremely complex depending on the following:

    • parties to the transaction;
    • nature of the loan;
    • manner of repayment of the loan amount;
    • type of interest payable; and
    • security to be provided.

    The agreement can be customised to take into account the peculiarities of each transaction. It is important to include variables based on the different circumstances of individual borrowers.


    Be aware of the legislation that either proscribes the type of provisions to be incorporated in these agreements or directly impacts loan transactions in Australia.

    • Consumer credit legislation

    Consumer credit law in Australia is governed by the National Consumer Credit Protection Act 2009 (Cth) (NCCP) which includes the National Credit Code (NCC). The NCC applies to credit contracts where:

    • the lender is in the business of providing credit;
    • a charge is made for providing the credit;
    • the debtor is a natural person or strata corporation (a strata corporation is a body made up of owners in a strata scheme and has responsibility for maintaining and repairing the common property and managing the finances of the strata scheme, taking out insurance, administering the by-laws, keeping records and accounts for the strata scheme); and
    • the credit provided is for personal, domestic or household purposes, to purchase, renovate or improve residential property for investment purposes, or to refinance credit previously provided for this purpose.

    The NCC does not apply to certain loans including low-cost short-term credit contracts (62 days or less) and certain small value credit transactions.

    • Code of Banking Practice (Banking Code)

    Most banks in Australia voluntarily agree to bind themselves to the Banking Code. The Banking Code sets standards of good banking practice to be followed by banks when dealing with individuals and small business customers and their guarantors. The provisions of the Banking Code are enforceable against those banks who bind themselves to its terms.

    • Banking (Foreign Exchange) Regulations 1959 (Cth) (Regulations)

    It is important to ensure that any loan agreement relating to a loan made in foreign currency or to be paid in foreign currency is not vulnerable to interpretation as a transaction involving the buying and selling of foreign currency. Otherwise, the agreement will be subject to the Regulations.

    • Personal Property Securities Act 2009 (Cth) (Act)

    This Act regulates the provision and registration of personal property securities. (refer to the PPSA Loan Agreement)

    This precedent

    This precedent sets out the basic terms to be incorporated into a loan agreement. The precedent should be customised for each loan transaction, including:

    • the identity of the lender, creditor and borrower;
    • the nature of the loan;
    • agreed payment terms;
    • interest repayments; and
    • security to be provided, if any.

    For the purposes of this precedent, the lender or credit provider is a company. However, the precedent can be customised for use where the lender is an individual. This loan agreement does not take into account the requirements of the NCC and it will need to be amended when drafting a loan agreement that needs to comply with the NCC.



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