How do i draw up a personal loan contract?

Question

im about to loan a friend of mine a sum of money and i was wondering how do i draw up a personal loan contract, one that will be legally binding in case they dont pay up.. what needs to be included in it? how many witnesses do i need? what info of thiers would be benefitial?

Answer 1

I suggest that you get 2 witnesses, both over the age of 18 and a Notary Public!!!!!
You do NOT have to have these, but it will help.
Just write out the contract & all of you sign it in the presence of the notary. It is a good idea to specify not only the amount of $ but when payments are due AND when the final sum is due, plus what charges will incur if payments are late, etc.

Answer 2

1

Answer 3

You need the amount of the loan when it is to be paid and contact information any payment information if that is the way it will be re-payed and how many past payments allowed before action is taken then take this paper in duplicate to a notary and have the individual sign it and you as well in front of a notary and they will notarize it and it becomes legal.
Good luck

But i must ask why loan the money if you find a need to have a contract? Depending on the amount of money if they fault it could still cost more to recover it than it was worth in the first place. If i had my doubts about my friend i would just not loan the money it makes enemy's fast.

Answer 4

Don't do it. You won't be their friend anymore if they don't pay and if they have bad credit and can't get a loan from a bank that's because they have a history of not paying things. So don't loan the money if you want to stay friends with this person.

Answer 5

write it up how you'd like & when the terms are agreed to, have you, your friend & a witness sign in front of a notary. that would be legally binding in court.

just your & their signatures would be enough, but why not have it even more secure?