Have a written agreement
If you’re borrowing or lending money, particularly where family or friends are involved, it always makes sense to formalise your agreement. A properly drafted agreement will protect your rights and help prevent a disagreement or relationship breakdown.
For very straightforward matters, a simple Deed of Acknowledgment of Debt will formalise the obligation to repay a loan. If required, security for the repayment of the loan can be added, for example in the form of a charge supported by a caveat over the borrower’s real estate.
For anything but the simplest of matters, it is desirable to record the transaction in a comprehensive loan agreement and security documents in the form of a mortgage or caveat over the borrower’s real estate.
We offer fixed prices for these services.
Matters to consider when you are lending money
- The loan amount (principal)
- Manner of repayment of the principal
- Interest charges
- Payment of interest
- Consequences of the borrower’s default
- Security for the borrower’s promises such as a mortgage, charge or guarantee
I am guaranteeing a loan and have been asked to obtain legal advice.
If you’re borrowing money or guaranteeing a loan and need independent legal advice on loan documents prepared by a bank or other lender, we can help.
If you need advice, get in touch.