The real aim of loan agreement
The real aim of the loan agreement is to make sure that the person who has borrowed money returns it to the lender in a stipulated time period failing which the borrower is legally obliged to make the payment right away. This agreement protects the lender and helps the borrower to keep a record of how much he has already paid back. The loan agreement is made for various purposes such as business loans, real estate loans, student loan, personal loan, etc.
Loan agreement for real estate
The real estate is one sector that is involved in seeking loans. The loans enable the buyer of the property to pay for his desired property without having to worry about the finances. But, the banks do not lend unless you can show a proof that you can pay back their money. The loan agreement is one such method to legally bind a borrower to pay back the money he has borrowed. The loan agreement consists of:
- The payment method which gives a detail of how the payment will be made- in full, monthly, with or without interest, etc.
- The schedule of payment of the borrowed money is also defined here.
- The amount which has been borrowed
- The details of the lender and the borrower like the name, address, contact, etc.
- A security which may be your other property or a vehicle or any type of heavy machinery or jewelry or anything that has market value similar to the amount borrowed.